For Joseph Roberto, PCSB Bank's chief executive, buying CMS Bancorp brought his career full circle.

The acquisition is a homecoming for Roberto, who grew up in Mt. Vernon, N.Y., where CMS was based.

As a grade schooler, Roberto delivered the local newspaper, the Daily Argus, where one of his customers was president of CMS predecessor Community Mutual Savings Bank. And it was in Mt. Vernon where he landed his first banking job.

Roberto was studying business in college and working part-time as a clerk in a neighborhood market. At that time, the job involved helping customers carry groceries to their cars. One man who shopped regularly on Saturdays had a reputation as a lousy tipper, and all the clerks made it a point to avoid him — everyone that is, except Roberto.

Roberto didn't know that the man was a vice president at nearby Yonkers Savings and Loan until the banker made him a life-changing offer.

"I'd carry his groceries, he'd tip me a dime and I'd thank him," Roberto recalled. "One day, he offered me a job as a teller."

Roberto took the job and never looked back. He spent 29 years at Yonkers, helping it expand from a single branch with $50 million in assets to nine locations and $650 million in assets when it was bought in 2002 by Atlantic Bank of New York.

PCSB hired Roberto in 2005 as its chief financial officer; he became president and CEO in 2012.

Roberto began taking a look at his former stomping grounds after realizing that the number of banks around Westchester County had been contracting, largely as a result of industry consolidation.

In 1973, for instance, there were 25 banks based in Westchester, based on data from the Federal Deposit Insurance Corp. "Every town in the county had a community bank named for it," Roberto said.

The county now has just four local banks, including the $1.2 billion-asset PCSB, which moved its headquarters from Brewster in Putnam County to a 25,000 square-foot building in Yorktown Heights earlier this month. The remaining banks serve a market with a growing population and a median family income that is significantly higher than the state and national averages.

Four big banks — JPMorgan Chase, Citigroup, Bank of America and Wells Fargo — controlled more than a third of Westchester's $71.5 billion in deposits at June 30, according to FDIC data.

"There're only a handful of community banks left," Roberto said. "You have a vibrant community serviced mostly by large regional and money-center banks."

PBSB wants to deliver a hyper-local experience at each of its branches, tailoring products and services to the needs of the local customer base, Roberto said, noting that each branch "has its own unique demographic."

PCSB, which has eight Westchester branches– up from three before buying CMS — has plenty of room to grow, holding just 0.8% of the county's deposits.

Buying CMS "got them additional density in a high-growth market," said Peyton Patterson, a consultant who previously served as CEO of Bankwell Financial Group and NewAlliance Bancshares. "Westchester is close to Connecticut, and it provides them a platform to New York City. … I understand why they wanted to do that deal."

While it remains to be seen if PCSB will be able to generate more business, the assumptions behind its strategy make perfect sense, Patterson said.

"By and large, people don't trust banks, and the bigger the bank, the less the trust," she said. "If they can deliver on their slogan of `true local, true bank,' and if it looks and feels like credit decisions are being made locally, they'll be successful."

Early results seem encouraging. PCSB earned $1.3 million in the third quarter, its first full reporting period since buying CMS.

PCSB, which had been known as Putnam County Savings Bank, is settling into its new identity.

The board decided that a "more generic" name was more since about two thirds of the bank's nearly $1.1 billion in deposits are now outside Putnam County, Roberto said. The board considered building a new brand around monikers like "community" or "Hudson," before settling on corporate initials that also serve as the bank's web address.

One thing that won't be changing any time soon is PCSB's organizational structure. The bank is a depositor-owned mutual that sees plenty of benefits to staying that way.

"We do have more flexibility as a mutual," Roberto said. "There's no voice from behind asking why are you spending that money?"

Case in point: PCSB's new first-time homebuyer program. Roberto said it will feature loan-to-value rates as high as 97%, along with a low interest rate and no charges for private mortgage insurance. "We can make our products a little more affordable" for borrowers, he said, even if it costs the bank a little more to offer.

Of course, the elephant in the room for PCSB, along with other mutual, is capital. At a time when banks need more capital than ever, retained earnings are the only way that depositor-owned institutions can get it.

Regulatory efforts have relieved some of the pressure on mutual banks and thrifts, said Douglass Faucette, a lawyer who serves as counsel for America's Mutual Banks, a trade group that represents mutual banks.

The House Financial Services Committee last month approved a bill exempting holding companies with less than $5 billion of assets, including most mutuals, from the Federal Reserve Board's consolidated capital requirements. The current threshold for exemption is $1 billion.

Inside PCSB's leadership, there little to no enthusiasm for conversion, but the move cannot be totally discounted. The company's core capital ratio is a healthy 9.1%, according to the FDIC, though it is down from 11.3% before the CMS acquisition.

"You can't lose sight of the fact that at some point you might need to raise more capital," Roberto said. "You fight [conversion] as long as you can. You just fight it."

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