Sun Bancorp in Mount Laurel, N.J., has decided to sell another branch and consolidate nine others as part of the ongoing streamlining of its retail network.
The $2.7 billion-asset company said on Tuesday that it has agreed to sell the deposits and loans of its Hammonton, N.J., branch to Cape Bank. The branch, with approximately $34 million in deposits and $4.9 million in loans, will be sold for a premium on deposits of 4%. Sun anticipates earning $500,000 by selling the branch.
Additionally, Sun is planning to close nine branches across seven New Jersey counties. These branches will be merged into eight nearby offices within the following counties: Atlantic, Cumberland, Gloucester, Mercer, Monmouth, Ocean and Salem.
"Consolidating branches is never an easy decision. However, as customers' channel preferences have evolved and costs have risen, it presents the opportunity to further maximize efficiencies within our branch network," Sun Chief Executive Thomas O'Brien said in a press release.
Both of these transactions are expected to be completed in the third quarter and reduce the company's annual noninterest expenses by approximately $4.6 million, the release said. Furthermore, one-time charges of $4 million tied to the consolidations will be offset by a $9.2 million net gain from another deal its sale of seven branches to Sturdy Savings Bank in early March.
Sun expects to have 31 branches in 11 New Jersey counties by yearend.
"We will have fully exited Salem and Cape May counties, which were the most remote locations from our core operations," O'Brien said.