The Village Bank, the newly named bank resulting from the merger of Auburndale Co-operative Bank and Newton South Co-operative Bank, will have branch locations in only five of Newton’s 13 villages – but branches in the city’s other villages, such as Newton Corner (above), are expected to follow.

When Newton’s two oldest community banks consolidate this fall, one new bank will provide the same old flare for the city’s 13 villages.

The Village Bank, the newly named bank resulting from the merger of Auburndale Co-operative Bank and Newton South Co-operative Bank, will aim to provide more quality and better service to the consumers of Newton and surrounding areas.

“The name was really designed to bring the banks together and make us a better and stronger institution going forward,” said Alfonso De Vito, president and chief executive officer of the $114.9 million in assets Newton South Co-op Bank. “We stress that both banks have a basic rule, and that is to protect and preserve the banks in the marketplace. By adopting the new name, we are addressing the needs of the consumer in the villages of Newton.”

The consolidation of Newton’s two mutual co-operative banks will result in an institution that will have branch locations in five of Newton’s 13 villages. The assets of both organizations will be combined, as will the management teams and staffs.

“Because it is not a takeover and instead a consolidation of two strong financial institutions, the change of the name to ‘The Village Bank’ would make more sense and it means more,” said Kenneth Brennan, president and chief executive officer of Auburndale Co-operative Bank, which has approximately $300 million in assets. “The name also allows us to expand into other markets.”

‘A Nice Blend’

While Brennan said there are no immediate plans to expand into other markets, he noted that the bank will move into other Newton villages and surrounding communities over the course of time because “it’s in the best interests of the bank.”

De Vito said The Village Bank anticipates “new opportunities” for staff and will offer consolidated bank products and services to consumers.

“It’s a nice blend [for the community] and the merger of the two management teams is a plus for the combined institution,” said Brennan. “This consolidation provides an opportunity for customers to use online banking and an alternative investment program, which is set up with the insurance investment program. [The merger] brings added products for customers … and it is an enhancement for the customers of both institutions.”

While the merger has no immediate effect on consumers, Brennan said the target date for closing on the deal is Sept. 30, 2003. Until then, both bank presidents are informing customers of the changes and progress of the deal.

“I have made approximately 150 calls to my customers and their response has been positive,” said De Vito. “The consolidation will be beneficial because we will have a variety of locations in Newton and Wayland and our customers will have more access to products and services that were normally not available because of technology.”

According to De Vito, the merger of the two banks would provide greater access to more technology that was unavailable at Newton South. Now, consumers will have online access and Internet banking available via The Village Bank – and with a larger asset size, De Vito said customers also would have greater accessibility to a larger loan portfolio.

Brennan said the bank’s customers also would have access to new and innovative bank products and services because the two banks’ combined assets will allow The Village Bank to invest more in technology and online banking products.

The consolidation agreement was unanimously approved by the boards of directors of both banks and is still pending until it receives the approval of state regulatory agencies and the Federal Deposit Insurance Corp.

Discussion of consolidating the two banks has been on board members’ minds for a few years and Brennan said it came to “serious conversation” at the end of 2002.

Once the consolidation is complete, members of both the Auburndale and Newton South boards will join forces to create an enlarged board of directors for the new bank.

De Vito will assume the role of chairman of the board of directors of The Village Bank and Brennan will serve as the bank’s president and chief executive officer. Joseph De Vito, currently the executive vice president and treasurer at Newton South, will join the senior management team at The Village Bank as executive vice president and chief financial officer.

Auburndale Co-op, which was chartered by the state in 1910 and has full-service offices in Auburndale, Waban, Newtonville and Wayland, has 70 employees. Its main office is located at 307 Auburn St. in Auburndale.

Newton South was established in 1913, maintains offices in Nonantum and Newton Highlands and has 20 employees. Its main office is located at 411 Watertown St. in Nonantum.

Alfonso De Vito said the basic goal of the consolidation was to protect the mutuality of banking in the current marketplace.

“We should be available to provide a variety of services due to the change in tech; some banks may not be able to do that,” he said. “We will have a bigger bank and our customers will have the direct access to the best of both banks.”

Melanie Nayer may be reached at mnayer@thewarrengroup.com.