Fidelity Bank, Colonial Co-operative announce $870M merger
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Fidelity Bank CEO Edward Manzi will lead a $870 million financial institution after a merger with Colonial Co-operative Bank.
Leominster-based Fidelity Bank and Gardner-based Colonial Co-operative Bank will merge to create a financial institution with assets of $870 million.
The agreement, announced Tuesday afternoon, has FIdelity essentially acquiring the much smaller Colonial Co-operative. According to a press release from Fidelity, the bank has assets of $800 million compared to Colonial's $70 million.
As part of the merger, Fidelity will committ to an earmark of $500,000 in increased contributions and investments for communities in the Gardner and Winchendon area in the form of charitable donations to nonprofit organizations.
The earmark will establish a micro-loan fund -- dubbed the Colonial Bank Loan Fund -- to support that area’s small businesses, to be facilitated by the Gardner Area and North Central chambers of commerce.
The merger has been approved by boards of both banks, but is still subject to review by the Federal Deposit Insurance Corp. and Massachusetts Division of Banks and the bank’s shareholders. The deal is expected to become final in the second quarter.
In a statement, Colonial President Joseph Guercio said small community banks are faced with challenges in today’s banking world.
“This partnership will allow us to stay competitive and fulfill our commitment to our communities, while maintaining our community bank values,” he said.
Fidelity Bank Chairman and CEO Edward Manzi will continue in his current role at the merged institution, as will Christopher McCarthy, president and chief operating officer of Fidelity.
Guercio will retire, but will still serve as president of the Colonial division for at least three months to help with the transition. Two members of the Colonial Co-operative Bank board of directors will join the Fidelity Bank board of directors.
All Colonial employees will join the Fidelity team. The announcement did not mention any reference of layoffs, but the banks will consolidate their separate Gardner branches into the current Colonial office on City Hall Avenue after significant renovations.
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