In what would be the first whole-bank acquisition in its 86-year history, Ridgewood Savings Bank in New York said it is buying City and Suburban Financial Corp. of Yonkers, N.Y., for $119 million in cash.
The deal, announced Friday, would boost Ridgewood's assets to nearly $4 billion and add 11 branches in metropolitan New York, including five in Manhattan and Westchester County. All of Ridgewood's 24 branches are in Queens, Brooklyn, the Bronx, and on Long Island.
William McGarry, Ridgewood's chairman, president, and chief executive officer, was traveling Friday and unavailable to comment on the deal. But in a news release, he said his company is "excited" about beefing up in the Bronx and moving into Westchester and Manhattan — two of the nation's most attractive banking markets.
"These markets represent a tremendous opportunity for growth on the both the retail and lending side of the business, and our presence there will serve as a platform for future growth," Mr. McGarry said.
Ridgewood has never made a whole-bank acquisition, according to the Federal Deposit Insurance Corp., though it has acquired branches. In 1991, it bought three branches of a failed bank from the Resolution Trust Corp.
City and Suburban's roots in New York date to 1889. At the end of 2006 it had $670 million of assets, $508 million of loans, and $571 million of deposits.
Its chairman and CEO, Marty Berger, also was unavailable to comment. In Ridgewood's release he said the two thrifts "share common beliefs and values about how to service our customers."
Ridgewood is one of the Northeast's largest mutual savings banks, and Mr. McGarry has said repeatedly said it intends to stay that way. Though he has been told the thrift could raise as much as $2 billion if it went public, he has said that a conversion to a stock-owned company would ultimately threaten its independence.
"There might be some very good reasons" to convert, "but not in our minds," Mr. McGarry told American Banker in 2004.
Besides, it is not as though Ridgewood needs the capital. It reported a Tier 1 risk-based capital ratio of 31.08% at the end of 2006, according to FDIC data. The average ratio for thrifts in its asset class of $1 billion to $5 billion was 13.99%.
The sale price is about 2.19 times City and Suburban's book value. The companies did not say when they expect the deal to close.
