Vol. XXX No. 4

Bank Notes

April 2001 April 2001

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April 1, 2001

FleetBoston-Summit Merger News

On March 1, FleetBoston Financial Corp, Boston, MA, merged with Summit Bancorp, Princeton, NJ, under the charter and title of FleetBoston Financial Corp. The combined company, with assets exceeding $200 billion, will rank as the nation's seventh largest bank holding company. As of June 30, 2000, FleetBoston Financial Corp had total deposits of $65.1 billion and ranked first among all commercial banking and thrift institutions in New England. As of the same date, Summit Bancorp had total deposits of $956.2 million and ranked 29th. On March 1, Summit Bancorp subsidiaries Summit Bank, Norwalk, CT, Summit Bank, Hackensack, NJ, and Summit Bank, Bethlehem, PA, merged with FleetBoston Financial Corp subsidiary Fleet National Bank, Providence, RI, under the charter and title of Fleet National Bank. On March 9, FleetBoston Financial Corp announced it will close 12 Connecticut branches as a result of its recently completed merger with Summit Bancorp. The closings, slated to begin June 7, will affect four Fleet branches and eight former Summit branches. Following the consolidation, Fleet will have 183 branches in Connecticut. The bank said all 12 branches are located less than a mile from surviving Fleet branches. Branch customers will be alerted 90 days before any closings. On March 23, FleetBoston Financial Corp. announced plans to consolidate 80 branches and one autobank facility in New Jersey, as a result of overlapping branches from its Summit Bancorp acquisition. Set to begin in July, the consolidation affects 47 Fleet branches and 33 former Summit branches. On completion, Fleet will operate 446 branches in New Jersey, which the bank said represents a 24 percent increase in branches for former Summit customers and a 261 percent increase in branches for Fleet's New Jersey customers. (Business Wire, 3/1; Internal Notice, 3/1; SNL Bank & Thrift Weekly, 3/12; 3/26/01)

On March 1, The Amesbury Co-operative Bank, Amesbury, MA, merged with The Provident Bank, Amesbury, MA, under the charter and title of The Provident Bank. As of June 30, 2000, Provident Bancorp, Amesbury, MA, parent company of The Provident Bank, had total deposits of $106.4 million and ranked 145th among all commercial banking and thrift institutions in Massachusetts. As of the same date, The Amesbury Co-operative Bank had total deposits of $19.3 million and ranked 224th. (Internal Notice, 3/7/01)

On March 2, The Apple Valley Bank and Trust Company, Cheshire, CT, a state-chartered bank and trust company, opened for business. (State of CT Dept. of Banking News Bulletin, 3/2; Internal Notice, 3/2/01)

On March 1, the First National Bank of Ipswich, Ipswich, MA, opened a branch located at Woodbury Avenue, Newington, NH.

On March 24, Farmington Savings Bank, Farmington, CT, opened a branch located at 117 East Street, Plainville, CT. (Internal Notice, 3/15; 3/27/01)

On March 16, Webster Financial Corp, Waterbury, CT, announced plans to close nine Connecticut branches effective June 8. The company said it would be consolidating the branches' activities with those of other nearby Webster offices. Webster spokesman Kalach said that, following a series of acquisitions, Webster determined that its branch network was too concentrated in certain areas.

All affected customers have been notified the requisite 90 days in advance of the closings. Webster has said that the closed branches will be in Danbury, East Hartford, Ellington, Enfield, Hartford, Newington, West Hartford, Wethersfield and Windsor Locks. (SNL Bank & Thrift Weekly, 3/19/01)

On February 26, the Federal Reserve Board of Governors (Fed) announced its approval of the application by The Charles Schwab Corp, San Francisco, CA, and its subsidiary, U.S. Trust Corp, New York, NY, to acquire Resource Companies, Inc., Minneapolis, MN, and thereby acquire Resource's subsidiary bank, Resource Trust Company, Minneapolis, MN. The Charles Schwab Corp acquired U.S. Trust Corp, and its subsidiary, U.S. Trust Company, Greenwich, CT, on June 1, 2000.

On March 23, the Connecticut Commissioner of Banking approved the merger of Resource Trust Company with and into U.S. Trust Company. (Actions by the Board, 3/3; State of CT Dept. of Banking News Bulletin, 3/23/01)

On March 15, W.R. Berkley Corp., New York, NY, and the Independent Insurance Agents of America, Alexandria, VA (IIAA), received conditional deposit insurance approval from the Federal Deposit Insurance Corp (FDIC) for their joint operation of thrift holding company Peyton Street Independent Financial Services Corp, Alexandria, VA. The thrift received Office of Thrift Supervision (OTS) approval in November 2000. It will operate in Massachusetts, Connecticut, and New Jersey, through federal savings bank InsurBanc, Farmington, CT, pending regulatory approval. (IIAA Press Release, 3/15; SNL Bank & Thrift Weekly, 3/19/01)

On March 23, Southington Savings Bank, Southington, CT, filed an application to convert from a capital stock savings bank to a bank and trust company. (State of CT Dept. of Banking News Bulletin, 3/23/01)

On March 6, the Bank of New York Co., Inc., New York, NY, acquired the corporate trust business of the former Summit Bancorp, Princeton, NJ, from FleetBoston Financial Corp, Boston, MA. FleetBoston completed its acquisition of Summit on March 1. The acquisition involves the transfer of bond trustee and agency relationships representing approximately $15.7 billion in outstanding securities, Bank of New York said. The transition is expected to be completed in the second quarter. Bank of New York has completed more than 30 similar transitions during the last eight years. (SNL Bank & Thrift Weekly, 3/12/01)

On March 15, Webster Financial Corp, Waterbury, CT, acquired Center Capital Corp., Meriden, CT, a privately held equipment financing company. Center Capital, which has assets of $260 million, finances commercial and industrial equipment through installment sales and leasing programs in all 50 states. Center Capital is the former leasing subsidiary of Center Financial Corp, Waterbury, CT, which was acquired by First Union Corp, Charlotte, NC. Center Capital was spun off to senior management in 1996. (FFIEC National Information Center, 3/29; SNL Bank & Thrift Weekly, 3/19/01)

On March 21, Compass Bank for Savings, New Bedford, MA, a subsidiary of Seacoast Financial Services Corp, New Bedford, MA, received approval from the Massachusetts Commissioner of Banks and the FDIC to establish a trust department. Compass Private Banking services will include money management through its trust business focused on individuals within its market area in southeastern Massachusetts. (SNL Bank & Thrift Weekly, 3/26/01)

On March 12, Richmond County Financial Corp, Staten Island, NY, filed documents with the Securities and Exchange Commission (SEC) stating the intention to apply with the OTS to increase its equity investment in Pamrapo Bancorp, Inc., Bayonne, NJ, from 5.1 percent to 9.9 percent. Pamrapo is the parent company of Pamrapo Savings Bank, SLA, Bayonne, NJ.

If the application is approved, Richmond would be the first to take advantage of new regulations allowing federal thrifts to own up to 9.9 percent of competing thrifts (Title XII of the American Homeownership and Economic Opportunity Act of 2000). On February 27, Summit Bancorp agreed to sell five branches in the Atlantic City, NJ, market to Richmond County Savings Bank, Staten Island, NY, a subsidiary of Richmond County Financial Corp.

On March 27, New York Community Bancorp, Inc., Westbury, NY, announced that it agreed to acquire Richmond County Financial Corp, Staten Island, NY, in an $802 million stock deal. Under the terms of the deal, Richmond County shareholders will receive 0.68 shares of New York Community for each Richmond County share held. New York Community Bancorp is the parent company of New York Community Bank, Flushing, NY, which operates in Connecticut and New York. (American Banker, 3/16; NY Times, 3/28; Richmond County SEC 8-K, 3/13/01)

On March 1, the Office of the Comptroller of the Currency (OCC) released a handbook detailing the "Activities Permissible for a National Bank." The 49-page handbook catalogues specific activities that fall under the Gramm-Leach-Bliley (GLB) definition of "part of, or incidental to, the business of banking." The broad categories of permissible activities include branching, consulting and financial advice, corporate governance, correspondent services, "finder" activities, leasing, lending, payment services, fiduciary powers and investments, as well as certain enumerated activities involving insurance and annuities, securities, and electronic commerce. (SNL Bank & Thrift Weekly, 3/5/01)

On March 22, Massachusetts became one of a handful of states with regulations designed to protect homeowners from the deceptive practices of so-called predatory lenders. Under new regulations from the Division of Banks, lenders who charge more than 5 percent of the borrowed amount for points and fees must tell applicants the loan "is not necessarily the least expensive" and advise them "to shop around." Lenders who charge an annual interest rate more than 8 to 9 percentage points higher than the relevant Treasury rate also must follow these new disclosure requirements. The new regulations also prohibit lenders from using only a borrower's home equity in approving the loan, without taking into account whether the borrower can make payments.

In the last year, a number of U.S. state legislatures have taken aim at home loan abuses, though North Carolina is so far the only one to pass an anti-predatory lending law. State bank regulators in New York and Illinois have also drafted rules to target the problem, as have cities including Baltimore, Oakland, Philadelphia and Washington, D.C. (Boston Globe, 3/21; Reuters, 3/22/01)

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.