Phoenix Home Life Has Deal for Control of New Hampshire Trust Company

Phoenix Home Life Mutual Insurance Co. said Wednesday that it has a deal to acquire a majority stake in Charter Holding Corp., a Concord, N.H.- based company with $750 million of trust assets.

Terms of the deal were not disclosed.

Hartford, Conn.-based Phoenix, the country's ninth-largest mutual life insurer, is looking to Concord to jump-start its sales through banks and to boost is asset management business, executives there said.

Charter, owned by a consortium of six New Hampshire savings banks, is the parent of Charter Trust Co.

"It is a testament to their (Phoenix's) belief there is an inevitability to the integration of banking, insurance, and brokerage," said John S. Carusone, president of Bank Analysis Center, a Hartford investment bank that advised Phoenix on the deal.

The deal, which is subject to regulatory approval, calls for Phoenix's 15-month-old trust subsidiary Phoenix Charter Oak Trust Co. to take majority ownership of Charter Holding. The partners were still negotiating how large a stake Phoenix will own.

The remaining equity in Charter would be maintained by its founders: Federal Savings Bank, Dover; Lake Sunapee Bank, Newport; Mascoma Savings Bank, Lebanon; Meredith Village Savings Bank, Meredith; Merrimack County Savings Bank; and Concord and Savings Bank of Walpole.

These six community banks would share an insurance agency that Charter would establish. The banks would market life insurance, annuities, and other investment products from Phoenix and other underwriters to as many as 350,000 bank customers in New England.

Phoenix last month said it would form a division this year to mass market life insurance policies through banks.

"This is literally hand-in-glove with that," said Martin J. Gavin, chief executive of Phoenix Charter Oak Trust. "We're trying to work with banks on the sale of insurance."

Dubbed Phoenix National Insurance, the unit will not limit itself to marketing insurance. It will also sell mutual funds managed by Phoenix, Duff & Phelps, its investment subsidiary.

Phoenix's deal for Charter follows the passage of a law in New Hampshire that favors the sale of life insurance through local banks.

"The (community) banks all recognize they need to be more in the business of selling more financial services products to compete with the large regional banks," said William C. Horn, president of Charter Holding.

Phoenix, which has more than $40 billion of assets under management, sells whole, term, variable, and universal life insurance as well as estate planning vehicles.

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