In the matter of the merger of South Weymouth Savings Bank, South Weymouth, Massachusetts with and into Weymouth Savings Bank, Weymouth, Massachusetts

By the Division of Banks

Pursuant to the provisions of Massachusetts General Laws chapter 168, section 34, Weymouth Savings Bank ("Weymouth" or the "Petitioner"), Weymouth, Massachusetts seeks approval to merge with South Weymouth Savings Bank ("South Weymouth"), South Weymouth, Massachusetts. Under the terms of the Agreement and Plan of Merger (the "Merger Agreement") dated as of May 27, 1997, South Weymouth will merge with and into Weymouth under the charter and by-laws of Weymouth and name of "Bank of Weymouth" or some "other name acceptable to each bank". At the time of filing the application with the Division of Banks (the "Division"), the banks stated that the name of the continuing bank would be Bank of Weymouth. Subsequently, during the Division's review process, the governing boards of Weymouth and South Weymouth indicated an intent to change the name of the continuing bank to "South Shore Savings Bank". The Division has noted that corporators for each bank are scheduled to vote in September on that proposed name change. The main office of South Weymouth and all of its other banking offices will become banking offices of the continuing bank.

Notice of the application has been posted and published. The time period for interested parties to submit comments has passed. Accordingly, all documents and materials related to this transaction have been reviewed. That record has been considered with regard to the financial and managerial resources of each bank, the competitive effects of the proposed transaction, the interests of the depositors of each bank, the future prospects of the institutions and the convenience and needs of the communities to be served by the consolidated entity as well as the performance of each bank under the Community Reinvestment Act ("CRA").

Weymouth is a state-chartered savings bank in mutual form. As of March 31, 1997, it had total assets of approximately $178.5 million. Weymouth has three banking offices located in Weymouth and one banking office located in Braintree. It has three wholly owned subsidiaries: First Weymouth Corporation; The 1833 Corporation and Fourth Weymouth Corporation. First Weymouth Corporation maintains equipment and other assets acquired primarily for the Bank and leases and develops real estate. The 1833 Corporation buys and sells securities for its own account and investment. In June 1997, the Division approved the establishment of Fourth Weymouth Corporation as a wholly owned subsidiary of Weymouth for the purpose of holding title to real estate to be acquired relative to a proposed branch office.

South Weymouth is a state-chartered savings bank in mutual form. As of March 31, 1997, it had total assets of $285 million. It operates six banking offices located in the communities of East Weymouth, South Weymouth, Hanover, East Bridgewater and Weymouth. South Weymouth owns two wholly owned subsidiaries. South Weymouth Security Corporation buys, sells and holds securities. The 1868 Corporation leases equipment to South Weymouth.

The primary service area for Weymouth is Norfolk County. South Weymouth's primary service area covers both Norfolk County and Plymouth County. The continuing bank's primary service area remains entirely within both of the above counties. Although both banks operate within Norfolk County, officially, there is only one municipality, Weymouth, in which both banks have banking offices. The Division's review noted that the combined entity would control a significant percentage of deposits in Weymouth. Accordingly, the competitive effects of the proposed transaction have been carefully considered. The Division focused on the availability of other banking options for the public in that area. The Division noted that a diverse number of competing financial institutions operate in Weymouth. They include commercial banks as well as thrift institutions and represent seven such institutions and eleven banking offices. Accordingly, the review of the transaction's impact on competition does not raise any concerns which would preclude its approval.

The application notes that the continuing institution's Board of Trustees will consist of all of the persons occupying such positions with both Weymouth and South Weymouth immediately prior to the consummation of the merger. The management of the combined bank is also detailed in the application documents. The applicant bank argues that the combined institution will produce some economies and service capabilities that may save costs. Moreover, upon consolidation, the continuing bank will meet all required capital standards. Accordingly, upon review, financial and managerial considerations support the application.

The Division has also considered whether public convenience and advantage will be promoted by this proposed transaction. The application documents provide examples of the benefits which will result from the merger. The continuing bank will have an extended branch office network. In particular, customers of Weymouth will now have access to banking offices in Hanover and East Bridgewater. The application also indicates that there are some products and services currently offered by Weymouth to its customers that are not presently available to customers of South Weymouth. These include twelve product lines provided to meet the credit needs of small business customers. Conversely, some products of South Weymouth are not at this time provided through Weymouth's banking offices. According to the Division's analysis, such products include a "no minimum balance" checking account and FHA 203K purchase/rehabilitation mortgages. The Division considered these reasons and others cited in the submitted documents in determining that public convenience and advantage will be promoted by approval of this transaction.

In determining whether or not to approve a petition under the statutory criteria, the Commissioner is also required to consider a showing of "net new benefits" related to the transaction. That term as set out in section 34 of said chapter 168 includes initial capital investments, job creation plans, consumer and business services and commitments to maintain and open branch offices, among other factors, which the Commissioner may deem necessary. The applicant bank has addressed this requirement of statute. In particular, the application states that the resulting bank's ability to meet the credit needs of small businesses will foster economic development and creation of new jobs. Moreover, the merger would enable the continuing bank to expand both Weymouth's and South Weymouth's community outreach efforts and affordable housing programs. Anticipated future participation in a reverse mortgage program is also cited as support for meeting this criteria.

Another factor which must be considered in the review of this application is the compliance of each depository institution with the statutory provisions of the CRA. Such review for state-chartered banks includes examination of personnel of the Division as well as analysis of concerns received from the bank's community and its response to those concerns fairly raised. A publicly available descriptive rating and evaluation by a federal bank regulatory agency will also be considered. Upon review, the Division has noted that both Weymouth and South Weymouth received a rating of "Satisfactory" in the most recent examinations of their performances under CRA.

Upon review of the application with reference to the relevant statutory and regulatory requirements, this Division has concluded that the consummation of the proposed consolidation would be in the public interest. On the basis of these considerations, approval is granted to merge South Weymouth with and into Weymouth under the charter and by-laws of Weymouth and name of South Shore Savings Bank pursuant to the provisions of said section 34 of chapter 168 of the General Laws. In accordance with the Merger Agreement and General Laws chapter 167C, section 3, approval is also granted for the continuing bank to maintain the banking offices of South Weymouth as branch offices, and for South Weymouth's branch office located at 1530 Main Street, Weymouth to become the main office of the continuing bank.

The approvals granted herein are subject to the following conditions:

  1. that the necessary votes of the corporators of both Weymouth and South Weymouth relative to the name of South Shore Savings Bank for the continuing bank are obtained. If such votes are not obtained, then the name of the continuing bank shall be Bank of Weymouth as previously voted and included in the Merger Agreement.
  2. that the proposed merger shall not become effective until the Certificate with the applicable name of the continuing bank signed by the Presidents and Clerks or other duly authorized officers of each bank indicating that each institution has complied with the provisions of Massachusetts General Laws chapter 168, section 34 has been returned with my endorsement thereon;
  3. that the proposed merger shall not become effective until Articles of Merger with my endorsement thereon are filed with the Secretary of State; and
  4. that the proposed merger be consummated within one year of the date of this Decision.
September 8, 1997
Date		Thomas J. Curry
Commissioner of Banks