After several months of community opposition, depositor boycotts and even two lawsuits, the conversion process of New Haven Savings Bank from a mutual savings bank to a public company is officially coming to an end.
NewAlliance Bancshares, Inc. — the stock holding company of New Haven Savings Bank, or NHSB, which will now be called NewAlliance Bank — received final approvals from the Connecticut Department of Banking and the Federal Deposit Insurance Corporation to complete its stock offering and conversion of NHSB, bank officials announced March 30. The conversion and acquisition is scheduled to close at the end of the day today, and NewAlliance shares should begin trading April 1 on the Nasdaq stock exchange.
New Alliance Bancshares also received final regulatory approval for the acquisition of Connecticut Bancshares, Inc., which is the holding company for the Savings Bank of Manchester, and Alliance Bancorp of New England, Inc., which is the holding company for Tolland Bank. Both banks are located in Connecticut. Approval came after votes of approval from Connecticut Bancshares, Inc. shareholders on March 30 and from Alliance Bancorp of New England, Inc. shareholders March 18.
“We are very pleased at the overwhelming financial support for our conversion from our depositors, and that the shareholders of Connecticut Bancshares and Alliance Bancorp have voted their support for our acquisitions,” said Peyton R. Patterson, President and Chief Executive Officer of NewAlliance Bancshares, Inc. and NewAlliance Bank.
Joseph H. Rossi, President of Alliance Bancorp of New England, Inc., and Sheila B. Flanagan and Eric A. Marziali, directors of Connecticut Bancshares, Inc., will join the NewAlliance Board of Directors.
NewAlliance bought the two banks for $677 million, which was raised through the sale of 102,493,750 shares of stock at $10 per share. Depositors who have held accounts at NHSB since June 30, 2002 were given first priority in purchasing shares, and approximately more than 30 percent signed up. Four million additional shares will be issued to the NewAlliance Foundation, an organization dedicated to benefitting New Haven.
Since Patterson made the conversion announcement in July, NHSB has faced opposition from depositors and other community members, due to both the bank’s refusal to hold a depositor vote and what some believed were overly generous compensation packages for the board of directors.
Towanna Marks, a plaintiff in one of two recently-dismissed lawsuits against NHSB and a former depositor, said she will continue to boycott the bank and convince others to do the same.
Marks said she did not consider signing up to buy NewAlliance stock, but had the bank given depositors a say in the conversion and acquisition process, perhaps more depositors would have taken advantage of the option.
“I was just a little aggravated about how they did things,” she said. “My mind was set, so I didn’t bother.”
With 74 branches, $3.8 billion in deposits, and $6.2 billion in assets, NewAlliance Bank will be the second-largest savings bank and fifth largest bank in Connecticut.