Holding companies for Hometown Bank, Easthampton Savings to merge
The holding companies for Oxford-based Hometown Bank and Easthampton Savings Bank will merge during the first quarter of 2016, and the banks will form a “strategic partnership” while maintaining autonomy, according to a statement from the banks Monday.
The merger of ESB Bancorp Inc. with Hometown Community Bancorp will create a mutual holding company will more than $1.7 billion in assets, the statement said. This would bring the new holding company, which will be named Hometown Financial Group, into the top ten largest banks in Central Massachusetts when ranked by assets, according to Worcester Business Journal data from June 30, 2014.
The holding company will also have more than $180 million in equity capital, and a combined branch network of 23 offices in Central and Western Massachusetts, and Northeast Connecticut.
The change will be seamless for customers, the banks said. Hometown Bank and Easthampton Savings Bank will merge mutual holding companies, but will continue to run their banks independently and autonomously.
Hometown is a mutual cooperative bank with about $400 million in assets, and operates eight branches in Central Massachusetts. Easthampton Savings is a mutual savings bank with about $1.4 billion in assets, and operates 15 branches in Western Massachusetts and Northeastern Connecticut.
Michael Hewitt, president and CEO of Hometown, said in the statement that the transaction “gives us the size and scale to be competitive and successful for many years to come and expands our market presence.”
Matthew S. Sosik, president and CEO of Easthampton Savings, said: “Both banks have strong boards and management teams and have long successful track records. We are going to leverage those strengths by operating our two banks separately underneath the combined mutual holding company, while taking advantage of economies of scale and efficiencies at the holding company level.”
Sosik added: “We are all very confident that this multi-bank holding company model represents the best future for our two banks, as well as for other like-minded community banks in New England that we hope to attract into our partnership over time.”
ESB earlier this year acquired Citizens National Bank in Putnam.
Hewitt and Sosik will continue as CEOs of their respective banks. Sosik will serve as the merged holding company’s CEO, while Hewitt will serve as its president. The merger is subject to a vote by both banks’ corporators.
As part of the transaction, there will be a $1 million contribution to start a charitable foundation for the communities served by Hometown Bank, Sosik said in the statement.
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