Vol. XXX No. 1

Bank Notes

January 2001 January 2001

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January 1, 2001

NYCB Acquires Haven Bancorp

On December 1, Queens County Bancorp, Inc., Flushing, NY, completed its acquisition of Haven Bancorp, Inc., Westbury, NY. The newly formed institution's title is New York Community Bancorp. Haven Bancorp was the parent company of CFS Bank, Westbury, NY. As of June 30, 1999, Haven Bancorp, Inc., Westbury, NY, had total deposits of $60 million and ranked 70th among all commercial banking and thrift institutions in Connecticut. (SNL Bank and Thrift Weekly, 12/4/00)

On December 1, U.S.B. Holding Co., Orangeburg, NY, completed its acquisition of the Stamford, CT, and Manhattan, NY, branches of La Jolla Bank, FSB, La Jolla, CA. The branches have combined deposits of approximately $108 million. La Jolla retains its loan portfolio and lending operations. The branches, including their deposits, have become branches of U.S.B. unit Union State Bank, Nanuet, NY. As of June 30, 1999, La Jolla Bank, FSB, La Jolla CA, had total deposits of $72.3 million and ranked 68th among all commercial banking and thrift institutions in Connecticut. (SNL Bank and Thrift Weekly, 12/4/00)

On December 1, The Savings Bank of Rockville, Rockville, CT, changed its title to Rockville Bank. (Internal Notice, 12/1; State of CT Dept. of Banking News Bulletin, 12/1/00)

On December 18, Seacoast Financial Services Corp, New Bedford, MA, received regulatory approval from the Federal Reserve Bank of Boston and the Massachusetts Board of Bank Incorporation to acquire Home Port Bancorp, Inc., Nantucket, MA. The transaction is expected to be completed on December 31. As of June 30, 1999, Seacoast Financial Services Corporation had total deposits of $1.6 billion and ranked tenth among all commercial banking and thrift institutions in Massachusetts. As of the same date, Home Port Bancorp, Inc., had total deposits of $212.3 million and ranked 82nd. (SNL Bank and Thrift Weekly, 12/26/00)

On December 15, the Connecticut Banking Commissioner approved the merger of Litchfield Mutual Holding Co., Litchfield, CT, with and into Northwest Mutual Holding Co., Winsted, CT, forming a single mutual holding company to be named Connecticut Mutual Holding Company. Northwest Mutual Holding Co. and Litchfield Mutual Holding Co. are institutions formed by Northwest Community Bank, Winsted, CT, and Litchfield Bancorp, Litchfield, CT, as part of a series of intermediate steps in the transaction. As of June 30, 1999, Northwest Community Bank, Winsted, CT, had total deposits of $187.7 million and ranked 43rd among all commercial banking and thrift institutions in Connecticut. As of the same date, Litchfield Bancorp, Litchfield, CT, had total deposits of $106.7 million and ranked 60th. (State of CT Dept. of Banking News Bulletin, 12/15/00)

On December 11, the Federal Reserve Board of Governors (Fed) approved the acquisition of J.P. Morgan , Co., New York, NY, by Chase Manhattan Corp, New York, NY. The newly created institution, named J.P. Morgan Chase and Company, would form the second-largest U.S. bank holding company by asset size as of September 30, 2000, with $707.5 billion in assets; only Citigroup, Inc., New York, NY ($804.3 billion), had more assets as of that date. The transaction is expected to be completed by December 31. (National Information Center, 12/28; SNL Bank and Thrift Weekly, 12/18/00)

On December 7, Urban Financial Group, Inc., Bridgeport, CT, filed an acquisition statement for the acquisition of The Community's Bank, Bridgeport, CT. On January 24, Urban Financial Group agreed to acquire three Connecticut branches, in Hartford, Bridgeport, and Bloomfield, from FleetBoston Financial Corp, Boston, MA. (Business Wire, 1/1; State of CT Dept. of Banking News Bulletin, 12/8/00)

On November 29, Investors Financial Services Corp, Boston, MA, signed a definitive agreement to acquire the Advisor Custody unit of Chase Manhattan Corp, New York, NY. Investors Financial will pay up to $42 million for the business, which provides safekeeping, advisory, and administration services to investment advisers. (SNL Bank and Thrift Weekly, 12/4/00)

On November 30, Citigroup, Inc., New York, NY, completed its acquisition of Associates First Capital Corp, Dallas, TX. The deal, announced on September 6, will allow Citigroup to gain inroads into Japan and Europe, and potentially add significantly to its equity lending operations. Associates is the largest publicly traded finance company in the U.S., with managed assets of more than $100 billion. (Citigroup, Inc., Press Release, 9/6; SNL Bank and Thrift Weekly, 9/11; 12/4/00)

On December 7, State Street Corp, Boston, MA, signed a definitive agreement to acquire 75 percent of Bel Air Investment Advisors, LLC, Los Angeles, CA, and 100 percent of brokerage affiliate Bel Air Securities, LLC, Los Angeles, CA, for a consideration totaling $217 million. The move is designed to increase State Street's relationship with high-net-worth investors. The transaction, which would be State Street Corp's third acquisition of a securities and investment firm in two years, is expected to be completed in early 2001. (SNL Bank and Thrift Weekly, 12/11/00)

On December 14, Aetna Trust Company, FSB, Hartford, CT, merged with ING National Trust, South Minneapolis, MN, under the charter and title of ING National Trust. The transaction is part of the acquisition of health care and insurance benefits provider Aetna, Inc., by international financial services conglomerate ING Group, parent company of ING National Trust. Aetna Trust Company was originally established as a thrift subsidiary of Aetna, Inc., for the provision of trustee, custodian, and record-keeping services to self-directed employee retirement and deferred compensation plans and to individual IRA plan clients. (Internal Notice, 12/14; State of CT Dept. of Banking News Bulletin, 11/17/00)

On November 26, TrustCo Bank Corp of NY, Schenectady, NY, withdrew its hostile bids for Cohoes Bancorp, Inc., Cohoes, NY, and Hudson River Bancorp, Hudson, NY, following the November 24 announcement that Cohoes and Hudson signed a new agreement to merge. (SNL Bank and Thrift Weekly, 12/4/00)

On December 8, Staten Island Bancorp, Inc., Staten Island, NY, completed its acquisition of four branches from Unity Bancorp, Inc., Clinton, NJ. In the transaction, Staten Island will assume approximately $42 million in deposits at a premium of 6.5 percent. (SNL Bank and Thrift Weekly, 12/11/00)

On December 19, the Office of the Comptroller of the Currency (OCC) approved the acquisition of Merchants New York Bancorp, New York, NY, by Valley National Bancorp, Wayne, NJ. All regulatory and shareholder approvals have been obtained, and the transaction is expected to be completed by January 19, 2001. (SNL Bank and Thrift Weekly, 12/26/00)

On December 13, the Fed proposed to expand the universe of subprime mortgage loans subject to closer regulatory scrutiny. The proposal is designed to improve regulatory tools for policing so-called predatory lending practices in the home-equity lending market. The Fed will seek public comment on the proposal, which will be published in the Federal Register. (SNL Bank and Thrift Weekly, 12/18/00)

On December 5, federal bank and thrift regulators agreed on consumer protection rules regarding the sale of insurance products by depository institutions. The rules, which become effective April 1, 2001, will prohibit lenders from making the extension of credit to customers dependent in any way on their purchasing insurance products. The regulations also limit the referral fees that can be charged in cross-selling products and order that "to the extent practicable," banking and insurance operations must be kept physically separated within branches. The rules also state that insurance products are not backed by the Federal Deposit Insurance Corporation (FDIC) and must be sold only by properly licensed persons. (SNL Bank and Thrift Weekly, 12/11/00)

On December 13, the Fed voted to seek public comment on a proposal to permit financial holding companies to act as real estate brokers and managers. The proposed rule would allow financial holding companies to offer real estate brokerage and management services by defining them for regulatory purposes as financial in nature, or incidental to financial activity. Additionally, the OCC is developing a proposal that would allow financial subsidiaries of national banks to act as real estate brokers and managers. The Fed and the OCC intend to publish the joint proposed rule in the Federal Register soon. Comments are due by March 2, 2001. (SNL Bank and Thrift Weekly, 12/18/00)

On December 20, the Fed issued a final rule on Regulation Y, allowing financial holding companies to act as "finders" in financial transactions. The rule - which established acting as a finder as "incidental to financial activity" - defines a finder as a party that brings together buyers and sellers of products and services "for transactions that the parties themselves negotiate and consummate." Because financial holding companies are restricted from selling commercial products directly, the new regulations will allow them to provide a broader array of products and services to their customers through third parties. The financial companies will also be able to generate fee income from merchants that use the banks as finders. The rule requires finders to clearly distinguish products and services offered by the financial holding company itself, and those offered by third parties for which the holding company acts as a finder. (SNL Bank and Thrift Weekly, 12/26/00)

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.