OTS Clears Sovereign to Buy Fleet Branches
WASHINGTON - The Office of Thrift Supervision on Tuesday approved Sovereign Bancorp's application to acquire 289 New England branches from FleetBoston Financial Corp.The OTS is requiring that the $25.4 billion-asset thrift buy the branches in three increments, to be closed in March, June, and July. Sovereign, which is based in Wyomissing, Pa., is expected to remain well capitalized after the completion of the deal and has been ordered to report to the regulator any large deviation from its financial projections.
Sovereign would pay FleetBoston $1.4 billion for the branches, which are in Connecticut, Massachusetts, New Hampshire, and Rhode Island. This deal, which was required by federal regulators as part of Fleet Financial Corp.'s acquisition of BankBoston Corp., is the largest transaction ever involving the purchase of branches by a federal thrift.
- Louis Whiteman
FleetBoston Financial Divestiture Timetable
|March 24, 2000||Rhode Island, Connecticut (BankBoston)||$4 billion||90||$3.2 billion|
|June 16, 2000||Eastern Massachusetts (Fleet)||$4 billion||86||$3.5 billion|
|July 21, 2000||Central Massachusetts, New Hampshire (Fleet)||$4 billion||109||$2.4 billion|
|Totals||$12 billion||285||$9.1 billion|
|Source: FleetBoston Financial and Sovereign Bancorp|
Three Bank Execs to Join Visa Board
SAN FRANCISCO - Visa U.S.A. is expected today to appoint BankofAmerica.com's James D. Dixon, First Union Corp. president G. Kennedy Thompson, and Wachovia Corp. president and chief operating officer G. Joseph Prendergast to its board of directors.Five positions on the 13-member board opened up beginning in February 1999, when Citigroup Inc.'s John S. Reed and Robert Lipp left because the board refused to allow Citi to move the Visa brand to the back of its credit cards.
Other spots opened when Visa board members left their banking posts. These departures included Richard W. Vague, the former chairman of Bank One Corp.'s First USA units; Michael R. Zucchini, former vice chairman of Fleet; and John Georgius, former president of First Union Corp.
Mr. Thompson succeeds Mr. Georgius on Visa's board. Mr. Dixon joins another BankAmerica executive, G. Patrick Phillips, on the board.
- Lisa Fickenscher
British ATM Network Allows 'Foreign' Fees
LONDON - Banks that are part of the Link cash machine network in Britain may charge noncustomers for using cash machines beginning in January, the Link board decided.The network's 34 member banks also must advise customers of charges on the cash machine screen before the transaction is carried out, Link said.
The announcement comes days after Don Cruickshank, who was appointed by the U.K. treasury to examine banking competition, said that many U.K. banks are overcharging customers at cash machines and that the government should take steps to discourage the practice.
Tuesday's decision means banks may no longer charge their own customers a so-called disloyalty fee for transactions at another bank's automated teller machines, according to a Link spokeswoman.
- Bloomberg News
N.J.'s Summit Buying 6th Insurance Agency
PRINCETON, N.J. - Summit Bancorp has announced a definitive agreement to buy Patgo Cos., a New Jersey insurance agency.The deal, which is expected to close shortly, is Summit's sixth for an insurance agency in two and a half years. Patgo, which targets the Hispanic and Portuguese communities in New Jersey, has offices in Newark, Bayonne, and Toms River.
The deal, announced Monday, would add to the banking company's property and casualty and group benefit insurance lines, said Kerry Calaiaro, senior vice president in investor relations. Terms of the transaction were not disclosed. Patgo, which has 40 employees and annual revenues of $2 million, is smaller than Meeker Sharkey Financial Group, a 191-agent operation that Summit is also acquiring. That deal is expected to close next month.
However, the Patgo acquisition should help build the banking company's fee-based business, Ms. Calaiaro said. Both agencies will be merged into Summit Insurance Advisors, which should post revenue of $55 million this year, she said.