Merger Announcements

On February 23, Washington Trust Bancorp, Inc., Westerly, RI, signed a definitive agreement to acquire PierBank, Narrangansett, RI. The transaction, which is subject to regulatory approval, is expected to be completed in the second half of 1999. As of June 30, 1998, Washington Trust Bancorp, Inc., parent company of Washington Trust Company of Westerly, Westerly, RI, had total deposits of $532.8 million and ranked fourth among all commercial banking and thrift organizations in Rhode Island. As of the same date, PierBank had total deposits of $47.8 million and ranked 13th. On March 14, Fleet Financial Group, Boston, MA, announced the plan to acquire BankBoston Corporation, Boston, MA, for $16 billion. The merger will create the eighth-largest bank in the country, which is to be named Fleet Boston Corporation, Boston, MA, with about $178 billion of assets. It is estimated that the combined Fleet-BankBoston will have to sell off $13 billion in deposits as well as an unspecified number of automated teller machines to meet regulatory and antitrust requirements. The transaction, which is subject to regulatory and shareholder approval, is expected to be completed in the fourth quarter. As of June 30, 1998, Fleet Financial Group had total deposits of $42.1 billion and ranked first among all commercial banking and thrift organizations in New England. As of the same date, BankBoston Corporation had total deposits of $33.0 billion and ranked second. (Boston Globe, 3/15; N.Y. Times, 3/15;SNL Weekly BankFax, 3/1, 3/22/99)

On March 26, HUBCO, Inc., Mahwah, NJ, completed its acquisition of the Hartford, CT, branch of First International Bank NA, Hartford, CT. As of June 30, 1998, First International Bancorp, Inc., Hartford, CT, parent company of First International Bank NA, had total deposits of $200.4 million and ranked 39th among all commercial banking and thrift organizations in Connecticut. As of the same date, HUBCO, Inc., parent company of Lafayette American Bank and Trust Company, Bridgeport, CT, had total Connecticut deposits of $1.0 billion and ranked 11th. (SNL Weekly BankFax, 3/29/99)

On February 26, Cornerstone Bank, Stamford, CT, announced that it would complete its reorganization on March 1. The bank will become a wholly owned subsidiary of holding company Cornerstone Bancorp, Inc., Stamford, CT. As of June 30, 1998, Cornerstone Bank had total deposits of $120.9 million and ranked 53rd among all commercial banking and thrift organizations in Connecticut. On January 11, Pepperell Bankshares Financial Group, Inc., Biddeford, ME, a new bank holding company, was formed through the acquisition of Pepperell Trust Company, Biddeford, ME. As of June 30, 1998, Pepperell Trust Company had total deposits of $35.6 million and ranked 40th among all commercial banking and thrift organizations in Maine. (Internal Notice 3/12; SNL Weekly BankFax, 3/1/99)

On March 23, Fleet Financial Group, Boston, MA, received the approval of the Office of the Comptroller of the Currency (OCC) to create and operate Web sites for small-business clients. The bank also will process credit card purchases over the Internet for those clients. Fleet expects to introduce the service nationwide this year. (American Bkr.; 3/23; SNL Weekly BankFax, 3/29/99)

On March 3, the board of New England Community Bancorp approved the creation of Passive Investment Company in order to take advantage of a change in Connecticut tax statutes. The change allows state-chartered banks to transfer mortgage loans into a wholly owned passive investment subsidiary. The subsidiary's income and dividends paid to the parent bank are exempt from Connecticut corporation business tax. (SNL Weekly BankFax, 3/8/99)

On March 23, Citigroup, New York, NY, agreed to buy the credit card portfolio from Mellon Bank Corporation, Pittsburgh, PA. Terms of the deal were not disclosed. Citigroup will establish an agent bank relationship with Mellon, allowing Citibank to market credit cards under the Mellon and Dreyfus brands. The transaction, which is subject to regulatory approval, is expected to be completed by in the third quarter. (American Bkr., 3/24; Boston Globe, 3/24; N.Y. Times, 3/24; SNL Weekly BankFax, 3/29/99)

On February 22, Wainwright Bank & Trust Company, Boston, MA, acquired Heritage Capital Management, Inc., Boston, MA, for an undisclosed amount. Heritage Capital Management is a privately owned investment advisory firm which specializes in the customized management of balanced portfolios primarily for high net worth individuals, nonprofit institutions, and family owned businesses. (SNL Weekly BankFax, 3/1/99)

On February 25, Pershing, New Jersey, NJ, the correspondent clearing division of Donaldson, Lufkin & Jenrette (DLJ), New York, NY, agreed to acquire the correspondent securities services business of Citicorp Securities Services, Inc., New York, NY, a subsidiary of Citigroup, Inc., New York, NY. Terms of the transaction were not disclosed. On March 23, Pershing completed its acquisition of the correspondent securities services business of Citigroup. (SNL Weekly BankFax, 3/1, 3/29/99)

On March 8, Abington Bancorp, Inc., Abington, MA, signed a definitive agreement to acquire Old Colony Mortgage Corporation, Brockton, MA, for an undisclosed amount. Old Colony Mortgage Corporation is a mortgage banking company, founded in 1996. (American Banker, 3/12/99)

On March 23, Bank of New York, New York, NY, agreed to purchase RBS Trust Bank Ltd. from the Royal Bank of Scotland PLC, Edinburgh, Scotland. In addition, the Bank will acquire an equity ownership in RBSI Security Services (Holding) Ltd., headquartered on the Island of Jersey. The proposed transactions are subject to negotiation of a definitive contract, final due diligence, and regulatory approvals. The transaction is expected to be completed by the third quarter. (SNL Weekly BankFax, 3/29/99)

On March 1, State Street Corporation, Boston, MA, signed a definitive agreement with Elkins/McSherry Company, Inc. to acquire a majority of their business. Elkins/McSherry comprises an analytics division - a leading provider of trade execution analysis services - and a New York-based brokerage firm. Terms of the agreement, which are subject to regulatory approval, were not disclosed. (SNL Weekly BankFax, 3/8/99)

On March 23, the Federal Deposit Insurance Corporation (FDIC) voted to simplify deposit insurance rules for "payable-on-death" and joint accounts. Under the new rule, owners of a joint account will be insured for up to $100,000 each, not $100,000 total. The rule also lets parents and siblings be insured beneficiaries of a "payable-on-death" account. Previously, only a spouse, child, or grandchild could qualify for this coverage. (American Bkr., 3/24; SNL Weekly BankFax, 3/29/99)

On March 2, the Federal Reserve Board of Governors (Fed), the Office of Thrift Supervision (OTS), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) adopted consistent capital standards for governing certain real estate loans, investments in mutual funds, and construction loans, as required by a 1994 banking law. The new rules will become effective on April 1. (SNL Weekly BankFax, 3/8/99)

On March 23, the Federal Reserve Board of Governors (Fed) finalized a rule designed to give merging banks more time to update their computers for the year 2000. The regulation allows banks that merged or will merge between July 1, 1998, and March 1, 2000, to be treated as separate banks until March 2001, in order to avoid any difficulties in integrating their computer systems. Banks typically have only a one-year transition period after a merger to combine computer systems. (American Banker, 3/24; SNL Weekly BankFax, 3/29/1999)

On March 3, the Federal Reserve Board of Governors (Fed), the Office of Thrift Supervision (OTS), the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) jointly issued Interagency Guidance on Subprime Lending. These guidelines are intended to remind banks and thrifts of the risks inherent in subprime lending and to outline the types of controls the agencies expect banks to have in place before engaging in this field of lending. (American Bkr., 3/4; SNL Weekly BankFax, 3/8/99)

Items in Bank Notes focused on developments affecting banking structure in New England. They were condensed from daily newspapers and press releases from federal and state financial regulatory agencies. Their reproduction does not imply our endorsement of the accuracy, opinions or policies reflected in the subject matter.Items in Bank Notes focused on developments affecting banking structure in New England. They were condensed from daily newspapers and press releases from federal and state financial regulatory agencies. Their reproduction does not imply our endorsement of the accuracy, opinions or policies reflected in the subject matter.