Easthampton, MA and Oxford, MA - Easthampton Savings Bank, the wholly-owned subsidiary of ESB Bancorp, Inc., (ESB) and Hometown Bank, the wholly-owned subsidiary of Hometown Community Bancorp, Inc., jointly announced today that they will form a strategic partnership through the merger of their holding companies. After this transaction is completed, the combined mutual holding company will have over $1.7 billion in assets and over $180 million in equity capital with a branch network of 23 offices located throughout central and western Massachusetts and northeast Connecticut. This announcement follows ESB’s 2015 acquisition of the Citizens National Bank in Putnam, CT, and continues a well-constructed growth plan. The two banks will merge mutual holding companies, but will continue to run their banks independently and autonomously.
Michael D. Hewitt, President and CEO of Hometown Bank, said, “We are very pleased to partner with a company that is as strong and successful as we are. This is truly about two successful banking entities joining forces in a partnership to better serve our communities. This transaction gives us the size and scale to be competitive and successful for many years to come and expands our market presence.”
Matthew S. Sosik, President and CEO of Easthampton Savings Bank, stated, “We are extremely excited to announce this strategic partnership with an organization with which we share a lot of familiarity and that, like us, has been a top financial performer for so many years. Our business models and cultures are very similar. Both banks have strong boards and management teams and have long successful track records. We are going to leverage those strengths by operating our two banks separately underneath the combined mutual holding company, while taking advantage of efficiencies and economies of scale at the holding company level. We are all very confident that this multi-bank holding company model represents the best future for our two banks, as well as for other like-minded community banks in New England that may be attracted to our partnership over time.”
Hewitt added, “The dynamics of community banking have changed dramatically over the years. Operating costs are under constant pressure and net interest margins have narrowed, so now more than ever size truly does matter. For both banks, this transaction creates critical mass, even stronger finances, and a plan to better serve all of our communities for many years to come.”
As a result of this transaction, Hometown Community Bancorp will merge into ESB Bancorp and Sosik will serve as the merged company’s CEO, while Hewitt will serve as its President. Both Sosik and Hewitt will continue as CEOs of their respective banks. The merged parent holding company is also planning to change its name to Hometown Financial Group to better reflect its strategic positioning as a multi-bank holding company.
“While we are going to change our holding company name, customers should expect no changes, name or otherwise, at either Hometown Bank or Easthampton Savings Bank. To the contrary, our customers will continue to see the same great service and level of community commitment that they have come to expect over the years. In fact, as part of this transaction ESB is funding a $1 million contribution to start a charitable foundation for the communities served by Hometown Bank," said Sosik. Both banks operate on identical technology platforms so there will be no customer disruption. "This will be entirely seamless to the customers of both banks," said Hewitt.
The Boards of Directors of both banks have unanimously approved this transaction. The merger is subject to a vote by both bank’s corporators, as well as receipt of customary regulatory approvals. The merger is expected to be completed in the first quarter of 2016.
ESB Bancorp, Inc. is the holding company for Easthampton Savings Bank, a Massachusetts mutual savings bank headquartered in Easthampton, MA. Easthampton Savings Bank has approximately $1.4 billion in assets and operates fifteen full-service banking offices in western MA and northeastern CT. Hometown Community Bancorp, Inc, is the holding company for Hometown Bank, a Massachusetts mutual cooperative bank headquartered in Oxford, MA. Hometown has about $400 million in assets and operates eight full-service banking offices throughout central MA.
For further information contact:
ESB Bancorp, Inc./Easthampton Savings Bank
Matthew S. Sosik
President and CEO