Meridian Interstate Bancorp Inc., the holding company for East Boston Savings Bank, has completed its acquisition of Mt. Washington Cooperative Bank.
The merger will create a community bank with 20 full-service branch offices located throughout the Boston metropolitan area. Each Mt. Washington branch office has become a branch office of East Boston Savings Bank, and will operate under the name Mt. Washington Bank, A Division of East Boston Savings Bank.
The transaction is expected to increase East Boston Savings Bank’s deposits from $931.4 million to $1.3 billion. Mt. Washington’s approximately $387.6 million in deposits in Suffolk county will increase East Boston Savings Bank’s market share ranking from 9th to 5th in the county, and 2nd in the county among institutions headquartered in Massachusetts.
In addition, Meridian Interstate expects to contribute approximately $15 million of capital to East Boston Savings Bank following the merger.
"We are very pleased to welcome Mt. Washington’s customers and hard-working employees into our franchise," said Richard J. Gavegnano, chairman and chief executive officer of Meridian Interstate and East Boston Savings Bank. "This transaction combines two locally focused banks that have long-standing ties to their communities and have served their communities for more than 278 years combined."
Edward J. Merritt, the former chief executive officer of Mt. Washington, will join the East Boston management team as president of the Mt. Washington division. Merritt and one former Mt. Washington director will join the Meridian Interstate board of directors, according to a statement.
"The merger with East Boston is a natural fit in terms of our locations and operating philosophy. We will continue to operate the Mt. Washington branches as a division of East Boston with the same personnel that our customers have come to depend on," said Merritt.
Pursuant to the merger agreement, Meridian Interstate issued 514,109 shares of its common stock to Meridian Financial Services Inc., Meridian Interstate’s mutual holding company. The shares issued reflect the value of Mt. Washington as determined by two independent appraisals.
As a result of the merger, the depositors of Mt. Washington have become depositors of East Boston Savings Bank, and will have the same rights and privileges in Meridian Financial Services, as if their deposit accounts had been established in East Boston Savings Bank on the date established at Mt. Washington.
Following completion of the transaction, Meridian Interstate will make a contribution of $250,000 to the Mt. Washington charitable foundation.
In connection with this transaction, Sterne Agee & Leach, Inc. acted as financial advisor to Meridian Interstate. Luse Gorman Pomerenk & Schick PC represented Meridian Interstate as legal counsel, while Foley Hoag LLP represented Mt. Washington.
