Abington, Mass. Co-Op Merge Effective at the close of business September 13, 2002, Massachusetts Co-operative Bank, Quincy, MA, merged with Abington Savings Bank, Abington, MA, under the charter and title of Abington Savings Bank. The merger represents the main aspect of the acquisition of Mass Co-op's parent, Massachusetts Fincorp, Quincy, MA, by Abington's parent, Abington Bancorp, Abington, MA. The deal, which is estimated to be worth $17.3 million, was announced in April and received shareholder and regulatory approval in August and September, respectively. Abington's Chairman James McDonough commented that Massachusetts Fincorp's franchise "represents a natural expansion of our franchise geographically and adds some great communities to our banking network."

As of June 30, 2001, Abington Savings Bank had total deposits of $479.2 million and ranked 42nd among all commercial banking and thrift institutions in Massachusetts. As of the same date, Massachusetts Fincorp had total deposits of $88.5 million and ranked 161st. (Internal Notice, 9/20/02; Abington Press Release, 9/10/02; SNL Bank , Thrift Weekly, 9/3/02, 9/16/02)

Banknorth, Bancorp Conn. Merge On August 31, 2002, Banknorth Group, Portland, ME, completed its acquisition of Bancorp Connecticut, Southington, CT. As part of the deal, Southington Savings Bank merged with and into Banknorth NA under the charter and title of Banknorth NA.

As of June 30, 2001, Banknorth Group had total deposits of $260.4 million and ranked 36th among all commercial banking and thrift institutions in Connecticut. As of the same date, Bancorp Connecticut had total deposits of $394.2 million and ranked 25th. (Internal Notice, 9/5/02)

Branch Acquisition On September 23, 2002, Ocean National Bank, Kennebunk, ME, purchased two branches from Maine Bank and Trust Company, Portland, ME. The branches were located in Kennebunk, and York, Maine. Ocean National Bank purchased only certain assets and deposits, not the office space.

As of June 30, 2001, Ocean National Corporation, Kennebunk, ME, the parent of Ocean National Bank, had total deposits of $202.5 million and ranked 22nd among all commercial bank and thrift institutions in Maine. As of the same date, Chittenden Corporation, Burlington, VT, the parent of Maine Bank and Trust Company, had total deposits of $209.1 million and ranked 21st. (Internal Notice, 9/24/02)

Branch Openings Wellesley Co-operative Bank, Wellesley, MA, opened a branch at 197 Linden Street, Wellesley, MA, on May 28.

On July 3, Farmington Savings Bank, Farmington, CT, opened a branch at 88 Scott Swamp Road, Farmington, CT.

The North American Bank and Trust Company, Waterbury, CT, opened a branch at 1160 Silas Deane Highway, Wethersfield, CT, on July 31.

Boston Private Bank and Trust Company, Boston, MA, opened a branch at 1223 Centre Street, Newton, MA, on August 5.

Eastern Bank, Lynn, MA, opened a branch at 265 Franklin Street, Boston, MA, on September 3.

On September 9, Danvers Savings Bank, Danvers, MA, opened a branch at 18-20 Central Street, Andover, MA.

Fleet National Bank, Providence, RI, opened six branches. On September 9, it opened branches at 730 Route 134, Dennis, MA, and 500 Main Street, Sturbridge, MA; on

September 16, it opened branches at 25 American Legion Highway, Revere, MA, and 1115 Grand Army Highway, Somerset, MA; and on September 23, it opened branches at 185 Summer Street, Kingston, MA, and 21 Paradise Road, Salem, MA.

Naugatuck Savings Bank, Naugatuck, CT, opened a branch at 75 Tremont Street, Ansonia, CT, on September 23. (Internal Notice, 8/29/02, 9/9/02, 9/13/02, 9/23/02, 9/26/02)

Branch Closings At the close of business on May 10, The Washington Trust Company of Westerly, Westerly, RI, closed its North Kingstown Wal-Mart branch located at 1031 Ten Rod Road, North Kingstown, RI, and its Wyoming branch located at 1168 Main Street, Wyoming, RI.

Medford Cooperative Bank, Medford, MA, closed its Medford High School branch on August 30. (Internal Notice, 9/12/02, 9/19/02)

Branch Address Changes Savings Institute, Willimantic, CT, relocated its Mansfield branch from 7 Ledgebrook Drive to 95 Storrs Road, Mansfield, CT, effective at the opening of business August 5. The branch name will now be East Brook Mall Branch.

Stoneham Co-operative Bank, Stoneham, MA, relocated its Billerica branch from 490 Boston Road to 493 Boston Road, Billerica, MA, on September 3.

People's Bank, Bridgeport, CT, relocated its Norwich branch from 30 Norwich Avenue to 45 Town Street, Norwich, CT, effective September 13.

On September 16, Bristol County Savings Bank, Taunton, MA, relocated its North Attleboro branch from 451 Elm Street to 96 Commonwealth Avenue, North Attleboro, MA. (Internal Notice, 8/29/02, 9/6/02, 9/10/02; State of CT Dept Banking News, 9/20/02)

Boston Private in Nonbanking Activity

Boston Private Financial Holdings Inc, Boston, MA, announced on September 19, 2002, that it has agreed to acquire a 26.4% stake in asset manager Coldstream Capital Management Inc, Bellevue, WA. The deal, which is subject to regulatory approval, is expected to close in the fourth quarter of this year. Financial terms were not disclosed. After entering Northern California through the acquisition of Boreal Private Bank , Trust Co, San Mateo, CA, Boston Private is looking to expand its operations to the Northwest. Chairman and CEO Timothy Vaill said in a statement, "we are delighted to be investors in Coldstream.we will continue to look for additional opportunities to expand our presence in the region."

As of June 30, 2001, Boston Private had total deposits of $835.7 million and ranked 36th among all commercial bank and thrift institutions in New England. (SNL Bank , Thrift Weekly, 9/23/02; Boston Private Press Release, 9/19/02)

State Street Negotiating with Deutsche Bank State Street Corporation, Boston, MA, and Deutsche Bank, Frankfurt, Germany, announced September 18, that they were in exclusive negotiations to craft a deal in which State Street would acquire "substantial parts" of Deutsche Bank's global securities business. In addition to the domestic custody and securities clearing businesses in the United States and the United Kingdom, the proposed deal would include Deutsche Bank's global custody, global fund services, and global performance measurement and benefit payment divisions.

Deutsche Bank anticipates finalizing negotiations in the fourth quarter of 2002. The acquisition would combine State Street's $6.3 billion of assets under custody with Deutsche Bank's $4.1 billion, making it the world's largest custody firm. (SNL Bank , Thrift Weekly, 9/23/02; American Banker, 9/19/02)

Fleet Sued Over Argentina; Company Says Brazil Different On September 19, shareholders of Summit Bancorp, Princeton, NJ, filed a lawsuit alleging that FleetBoston Financial Corp, Boston, MA, made false statements about earnings from its Argentinean operations and its loan loss reserves related to business in Argentina prior to the companies' merger. After the merger, which closed in March 2001, FleetBoston recorded a $2.3 billion charge on loans in Argentina and announced on September 5, that it would set aside $1.2 billion in reserves to cover more possible losses. The shareholders' lawyers said that information about FleetBoston's Argentinean operations was vital to shareholders voting on the merger and may have resulted in an overvaluing of FleetBoston's stock.

Recently, FleetBoston executives have been trying to spread the word that the company is not in danger of similar losses from its Brazil operations. Speaking early in September, CEO Chad Gifford said the situation in Brazil is "very, very different" than in Argentina. Gifford and several analysts point to a number of positive signs, including the fact that 80% of Brazil's domestic debt is financed by local investors, Brazil's foreign debt is comprised mostly of private-sector corporate debt, and the government was able to generate a primary surplus over 3% of GDP three years in a row. They also cite the country's floating exchange rate and the International Monetary Fund's $30 billion bailout agreement as major differences from Argentina. Fleet's exposure in Brazil is approximately $10 billion, but it has reduced lending by 23% since last year. (SNL Bank , Thrift Weekly, 9/9/02, 9/23/02; Dow Jones News Service, 9/20/02; SNL Bank , Thrift Weekly, 9/30/02; Boston Globe, 9/24/02)

M,T to Acquire Allfirst M,T Bank Corporation, Buffalo, NY, announced September 26, that it will acquire Allfirst Financial Inc, Baltimore, MD. Allfirst is the U.S. banking division of Allied Irish Banks Plc, Dublin, Ireland. The cash and stock deal is valued at $3.1 billion and will give Allied Irish four seats on the board of M,T, in addition to a 22.5% stake in the company.

Allfirst will be merged into M,T's unit, Manufacturers and Traders Trust Co. M,T's branch network will increase from 450 to over 700, and will expand the bank's reach from its home base in Western New York to the Metropolitan Washington, DC area. Both companies expect the deal to be completed by the first quarter of 2003. (SNL Bank , Thrift Weekly, 9/30/02)

OCC Issues Ruling on Debt Insurance The Office of the Comptroller of the Currency (OCC) issued a ruling September 17, that clarified its position on debt insurance products. The products, debt cancellation contracts (DCC) and debt suspension agreements (DSA), are arrangements in which a bank agrees to cancel or suspend a borrower's obligation to repay upon the occurrence of a specified event. Both compete with credit insurance, but are different in that there is not a third party insurance agent assuming the risk of nonpayment because the bank retains that risk.

Prior to the ruling, many banks hesitated about offering such contracts because some state insurance departments claimed regulatory authority. The OCC has always considered them to be banking products, however, until now there has not been a regulatory structure to preempt state insurance laws. Some analysts believe the new rule will continue to spur banks' already growing interest in offering debt insurance products. The American Bankers Insurance Association survey showed that in 2001, banks wrote $2.8 billion of the total $6 billion credit insurance market, mainly acting as an agent for insurance companies offering credit protection.

Additionally, the rule contains several consumer protection clauses. It prohibits national banks from conditioning the availability of credit on the purchase of a DCC or DSA, requiring a single lump-sum payment for any contract purchased with a mortgage loan, misleading practices and misleading advertising, and it limits banks' ability to retain a "unilateral right" to modify the contracts. The rule will take effect June 16, 2003. (American Banker, 9/18/02, 9/20/02; SNL Bank , Thrift Weekly, 9/23/02; OCC NR 2002-73, 9/17/02)

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.