Vermont Business Magazine Connecticut-based People's United Financial, Inc(NASDAQ: PBCT), the holding company forPeople's United Bank, NA, with branches across Vermont, announced today an agreement to acquire BSB Bancorp, Inc(NASDAQ: BLMT), the holding company forBelmont Savings Bank, a state-chartered savings bank headquartered inBelmont, Massachusetts, in a 100 percent stock transaction valued at approximately$327 million. Completion of the transaction is subject to customary closing conditions, including receipt of regulatory approvals and the approval of BSB Bancorp, Inc. stockholders.
"We are pleased to welcome Belmont Savings Bank to People's United," saidJack Barnes, Chairman & CEO, People's United Financial. "Together, we share a similar culture, a customer-centric approach to banking and guiding principles centered on relationships, personalized service and community giving. The acquisition will deepen and expand our presence in theGreater Bostonarea, particularly in the suburbs west of the city, which are attractive banking markets. As such, our Boston MSA deposit market share rank will increase from #13 to #8 on a pro-forma basis."
Established in 1885,Belmontis a community-focused bank providing a range of retail and commercial products and services. With$3 billionin assets,Belmontis a 2018 Fortune 100 "Fastest Growing Company," and has six branches in theGreater Bostonarea, including three inside Star Markets. The bank has delivered significant organic loan growth since its mutual conversion in 2011 and produced excellent asset quality metrics. Since that time,Belmonthas grown its diversified loan portfolio at a compound annual rate of 27% by focusing on commercial relationships, while maintaining its residential lending heritage.
"People's United Bank andBelmontshare a rich history in the Northeast, and many synergies that will create significant value for both customers and stockholders," saidBob Mahoney, President & CEO, BSB Bancorp, Inc. "Our customers will benefit from People's United's broader array of products and services, enhanced digital capabilities and expansive branch network. In addition, People's United's success with in-store locations will allow for the seamless integration of ourStar Marketbranches."
People's United expects the transaction to be approximately$0.03accretive to earnings per common share based on fully phased-in cost savings, with a tangible book value earn-back of 3.1 years and an IRR of over 20%. Under the terms of the agreement, which has been approved by both companies' boards of directors, BSB Bancorp, Inc. stockholders will receive 2.0 shares of People's United Financial stock for each BSB Bancorp, Inc. share. The transaction is valued at$32.42per BSB Bancorp, Inc. share, based on the closing price of People's United's common stock onNovember 26, 2018. The transaction is expected to close by the second quarter of 2019.
"The acquisition ofBelmontcomplements our strong organic growth in the Commonwealth ofMassachusetts, particularly in theGreater Bostonarea," saidPatrick Sullivan, EVP, Massachusetts Market President, People's United Bank. "We see significant opportunity for further growth in the region, with an eye toward delivering an expanded, tailored service model. The transaction enhances our already robust team of commercial and retail bankers and builds upon the momentum we are generating with the opening of our Seaport branch location early next year, and the recent addition of three new specialized business lines to ourBoston-based Commercial team."
A conference call to discuss the acquisition is not scheduled. However, a presentation with additional information on the acquisition can be accessed by visitingwww.peoples.comunder the "Investor Relations" tab, by clicking "News & Events," and then "Investor Presentations."
Keefe, Bruyette & Woods, Inc. served as financial advisor to People's United and Simpson Thacher & Bartlett LLP served as legal counsel to People's United.
J.P. Morgan Securities LLC served as financial advisor to BSB Bancorp, Inc. andLuse Gorman, PCserved as legal counsel to BSB Bancorp, Inc.
About People's United Bank, N.A.
People's United Bank, N.A. is a subsidiary of People's United Financial, Inc. (NASDAQ: PBCT), a diversified financial services company with$47 billionin assets. People's United Bank, founded in 1842, is a premier, community-based, regional bank in the Northeast offering commercial and retail banking, as well as wealth management services through a network of over 400 retail locations inConnecticut,New York,Massachusetts,Vermont,New HampshireandMaine.
About Belmont Savings Bank
Belmont Savings Bankis a$3 billion,Massachusettssavings bank dedicated to quality, convenience, and personalized service. The bank builds on a proud history of financial strength and a tradition of active involvement in the community. Belmont Savings Bank provides a full range of banking services for professional commercial real estate investors, developers and managers as well as individuals and local small business owners through two full-service offices inBelmont, one full-service office inWatertown, and threeStar Marketbranches inWaltham,NewtonandCambridge.
SOURCE BRIDGEPORT, Conn.,Nov. 27, 2018/PRNewswire/ --People's United Financial, Inc.www.peoples.com