Connecticut Attorney General Richard Blumenthal is probing First Niagara Financial Group Inc.'s $1.5 billion proposed acquisition of NewAlliance Bancshares Inc.
In a letter Wednesday, Blumenthal asked the banks to provide his office with information about the merger and justification for it. He noted that the Connecticut Department of Banking can only approve bank mergers that benefit the state's economy and the public.
"I believe the proposed merger raises significant and far reaching legal and public policy issues, including its effect on Connecticut jobs, and our economy, as well as community banking - in short, it's potential adverse impacts as compared to any benefits to the public," Blumenthal said.
Last month, First Niagara agreed to acquire NewAlliance, which is based in New Haven, Conn., in a cash and stock deal valued at $1.5 billion.
After the merger is completed, First Niagara would have $29 billion in assets and more than 340 branches in the Northeast.
The state attorney general is seeking information on jobs that may be lost and branches that may close as a result of the merger, details on new products and services that will be offered to Connecticut consumers and the combined bank's plans for providing credit to consumers and businesses.
He's also seeking an accounting of executive and shareholder compensation from the deal and details on First Niagara's credit card and overdraft fee policies.
Spokesperson at First Niagara and NewAlliance didn't immediately return phone calls seeking comment Wednesday.
