Keycorp Views New Hampshire as Good Fit

Hampshire. And the Granite State's top regulator says the bank is a welcome addition to New England's shrinking competitive market. Keycorp won approval in September from the state's Board of Trust to establish a new bank. Though there are no immediate plans to open a bank, Michael McNamara, president and chief executive of Key Bank of Maine, said New Hampshire represented a sensible expansion for the $68 billion-asset Cleveland company, which already has banks in Maine, New York, and Vermont. Keycorp plans to merge its banks nationwide into four separate charters. New Hampshire would be part of the future Key Bank of the Northeast, which the company hopes to create within a year. Because it identified New Hampshire as an important fill-in state, Mr. McNamara said his company applied for the new bank rather than wait and enter the state through acquisition. Keycorp will, however, continue to pursue acquisitions in the region, Mr. McNamara said. Keycorp has had a small-business loan production office in Manchester since January 1993, and serves as the third-largest Small Business Administration lender in New Hampshire. "We are always interested here in New Hampshire in having banks come into the state if they wish to bring capital here, if they wish to bring jobs here," said Rolland Roberge, New Hampshire's bank commissioner. He said Keycorp may purchase branches shed by the merging Fleet Financial Group and Shawmut National Corp. Keycorp operates the largest bank in Maine and has a big presence in upstate New York. Its total assets in the Northeast are about $18 billion, making New England its largest region outside the Rust Belt states of Ohio, Michigan, and Indiana. "I think (New Hampshire) would be a good move for Keycorp," said William W. McGinnis of Robert W. Baird & Co. "It allows them to further their strength in the Northeast." Mr. McNamara, who noted that Keycorp wasn't a bidder on the five Fleet- Shawmut branches, added that the merger would create opportunities for the bank. Instead of facing both Fleet and Shawmut, Keycorp will now only have one large competitor in New Hampshire, he said.