Joyce Moed | Business Samples

Haverhill Bank Merger
By Joyce Moed

HAVERHILL, Mass.–Northeast Community Credit Union and Haverhill Bank announced their plans last week to merge the two institutions under the name of Haverhill Bank.

Under Massachusetts state law, the resulting institution will be chartered as a bank. Peter DiBenedetto, Northeast Community Credit Union treasurer and CEO, will serve as president and chief operating officer; Thomas R. Faulkner, Haverhill Bank president, will serve as chairman and CEO.

"In this age of national bank mega-mergers, this union of two long-standing and respected local institutions provides the greatest opportunity for improved services and choice for Greater Haverhill residents," Faulkner said. "We’re both mutual institutions doing business in Haverhill."
Faulkner stressed that with the bank serving the community for more than 100 years, and the credit union serving since 1934, they are both familiar to the residents.

"We’re both in the same business and we’re both facing the same issues," he said, including competition and deposit growth.

"And frankly we’re both competing against each other and it’s counterproductive."

Faulkner said both institutions were approached by credit unions and banks outside the area, but they turned them down, in favor of staying loyal to the community that they have worked with for so many years.

"We know each other," he said. "It just made sense. There aren’t many local viable options. They would have to go out of town and we would have to go out of town. Merging keeps the jobs in the city."

Faulkner said that no layoffs are proposed.

"We’re going to let attrition take care of that," he said. He expects 20% attrition in two-years time.

All six branches will remain open after the merger. Instead, efficiencies will come in the areas of information technology, insurance, auditing and other operating expenses.

The new banks will have combined assets of about $260 million, deposits of $220 million and capital of $30 million, according the Haverhill Bank, thereby enabling the ability to offer larger loans than either of the separate institutions may now provide. Together they have about 85 employees.
"We’ve continued to grow steadily since 1934 while maintaining a strong capital base," DiBenedetto said. "When we looked at what we wanted to be able to offer out members in the future, it made sense to combine our efforts with an institution that has similar values and is also coming from a position of strength. It’s a good marriage, a good fit."

The merger requires approval by members, depositors and regulators, including the commissioner of banks, the FDIC and the NCUA. None of the approvals have been gotten yet, but DiBenedetto expects everything to go smoothly, with the merger being completed by the end of the year.
"Both boards voted unanimously," Faulkner said.

Neither DiBenedetto nor Faulkner are aware of any previous mergers of a credit union and bank in Massachusetts.

"We’ll be the first," DiBenedetto said.

Employees, in addition to the Massachusetts Credit Union League, were notified before the press release was distributed.

"My staff was positive," he said.

DiBenedetto said that he will miss working with the League, as they have been very helpful to the CU throughout the years.

The Massachusetts Credit Union League could not be reached for comment.