NORWAY – Norway Bancorp, parent company of Norway Savings Bank, has agreed to acquire the parent company of Portland-based Coastal Bank for $27 million, the companies announced Monday.

Under the agreement, Norway Bancorp would pay $21 for each outstanding share of First Coastal Corp., the companies said.

Coastal Bank, which was created in 1858, will continue to operate under its own name as a Portland-based division of Norway Savings Bank, which was created in 1866 and will keep its headquarters in Norway.

The transaction, which requires shareholder and regulatory approval, is expected to be completed in the third quarter.

“This merger provides both banks the opportunity for growth and expansion while maintaining our local bank philosophies and separate identities. This is the best of both worlds,” said Robert Harmon, president and chief executive officer of Norway Savings Bank.

The combination of two of Maine’s oldest banking institutions will create the fourth-largest Maine-based bank, with $580 million in assets and 18 offices in southern and western Maine.