Decision relative to the petition to establish Navisbank in Gloucester, Massachusetts
By the Division of Banks
The Incorporators (or the "Petitioners") of the proposed Navisbank (the "Bank" or "Navis") have submitted an application with related documents to the Board of Bank Incorporation (the "Board") for the issuance of a certificate that public convenience and advantage will be promoted by the establishment of the proposed Bank in Gloucester, Massachusetts. (The proposed Bank's name is derived from the latin word for "ship.") The Petitioners seek to establish the Bank as a trust company under the provisions of Massachusetts General Laws chapter 172.
Notice of the application, affording opportunity for interested persons to submit comments, has been published and posted in accordance with the requirements of section 6 of said chapter 172 of the General Laws and procedures of the Board. A public hearing was held on Thursday, November 7, 2002 by the Board to receive comments from interested parties. The time for filing comments and supplementary materials after the hearing has passed. The application, all documents submitted and the oral and written comments received on the record of this matter have been considered by the Board.
The establishment of a state-chartered trust company by statute involves a two-step procedure before the Board. The first is the petition now pending while the second step is a certificate to transact business. In determining whether to issue a certificate that public convenience and advantage will be promoted by the establishment of a new trust company, the Board has reviewed the statutory criteria of the adequacy of banking facilities in the area, the general character of the Bank's management, the adequacy of its capital structure and the convenience and needs of the community to be served. The Petitioner's filings and testimony at the public hearing have addressed each of these matters in conjunction with the application.
This matter is before the Board for the second time. The original application was heard by the Board on October 10, 2001. The Certificate of Public Convenience and Advantage was issued by the Board on November 13, 2001 in conjunction with its written findings that applicable provisions of law had been met. ( See Decision On The Petition To Establish Navis Bank In Gloucester, Massachusetts dated November 13, 2001.) The Petitioners have been in the process of completing the necessary organizational requirements during the past year including efforts as described to the Board to raise the required amount of capital. The Board's staff was previously notified of the possibility that the proposed Bank would not be able to complete its organization within one year from the date of the first certificate issued by the Board. By operation of law, the first certificate is deemed to be revoked on November 13, 2002. Accordingly, it became necessary for the Petitioners to file this application for consideration by the Board. The Bank's application for deposit insurance was approved by the FDIC on September 24, 2002 with certain conditions. The Petitioners updated the Board as to their efforts to raise the minimum initial capital required. The actual amount raised, the manner by which all such funds were obtained, as well as the shareholders of Navis are all matters to be analyzed by the Board during the next stage of this two-step process to form a trust company.
The Bank stated it anticipates being in a position, given its intended plans for site renovations, to open for business on or before March 15, 2003.
The submitted application is substantially similar to the original filing in 2001 and arguments in support of this petition closely align with those previously offered. The Board inquired as to the circumstances surrounding the Petitioners proposed timetable to complete the organization and the degree of certainly with respect to the timetable as represented.
As described in the Board's prior decision and reiterated in this application, it continues to be the intention of Navis to focus significantly on providing banking services to small to medium sized businesses thus serving those individuals looking for a commercial bank with a community focus. The Bank contends that it will meet the banking needs of individuals, professionals, and small to medium sized businesses, by providing local management, knowledge, investment, control, and competitive services and products in both traditional and non-traditional ways. The consumer loan products to be offered include fixed and variable rate residential mortgages, including construction, 1-4 family owner occupied, non-owner occupied, and condominium loans. Home equity lines of credit will also be a significant component of the Bank's residential lending efforts. Commercial lending products will include commercial real estate loans, working capital lines of credit, asset-based loans, and letters of credit. A wide array of depository services are also planned and summarized in the submitted documents. According to the application, the Bank intends to offer a full suite of consumer and commercial deposit products. Consumers will choose from a menu that will include checking, savings, money market, certificate of deposit, and IRA accounts. Rates and fees will be determined relative to market conditions, representing a strategic mix of marketing and asset/liability management objectives. The Bank intends to be open six days a week. Electronic banking services will also be available.
The proposed Bank's President and Chief Executive Officer was identified to the Board in the initial process and remains the lead proponent in this second filing. Individuals selected to serve in certain senior officer positions of the Bank were also identified to the Board. The Board of Directors would consist of ten individuals identified in the filing, the large majority of which are also Incorporators.
The Board again reviewed the Bank's proposal to comply with the Community Reinvestment Act ("CRA"). The petition contains the information on the proposed lending activities of the Bank. It adequately cites the Bank's intentions for meeting local credit needs and promoting community involvement by the Bank. The proposed areas to be served are determined to be reasonable.
The Board's consideration of this matter has included the record established by the Bank's initial application; the Board's prior decision; the current application and testimony at the public hearing. Based on this record, the Board finds that the applicable statutory criteria as to the adequacy of banking facilities in the area, the general character of management, the adequacy of capital structure and the convenience and needs of the communities to be served have been fulfilled and that the establishment of the proposed bank is in the public interest and the facts that warranted the Board's previous determination remain. In accordance with these findings, the petition is approved and a certificate that public convenience and advantage will be promoted by the establishment of Navisbank is hereby issued.
Both the Petitioners and the general public are advised that the proposed Bank must fulfill its statutory obligations to obtain a certificate to transact business according to the provisions of Massachusetts General Laws chapter 172, section 9. These preconditions for initiating transactions at Navis must be completed by June 30, 2003, which time period may be extended upon petition at the sole discretion of the Board. Additionally, all statutory requirements applicable to Navis must be completed within this period.
The approval granted herein is subject to the following additional conditions:
- During the organization period the proposed Bank shall be referred to in all public materials as "in organization".
- All organization documents, including Articles of Organization and all proposed Bank policies, must be submitted to the Board for review.
- All materials related to any stock offering, including the prospectus and marketing materials, must be submitted to the Board for review.
- No material change in the business plan submitted to the Board may occur within the organization period and for a period of three years commencing on the date the Bank opens to transact business without the prior written approval of the Division of Banks.
| Thomas J. Curry Commissioner of Banks | |
| Alan L. LeBovidge Commissioner of Revenue | Board |
| Shannon P. O'Brien Treasurer and Receiver-General | |
| November 13, 2002 Date |
Certificate of Public Convenience and Advantage
The Board of Bank Incorporation constituted under the provisions of Massachusetts General Laws chapter 26, section 5, and acting under the powers conferred upon it by chapter 172, section 6 of said General Laws, hereby certifies that public convenience and advantage will be promoted by the establishment of a trust company in the City of Gloucester, in the Commonwealth to be known as
NAVISBANK
This Certificate requires that the applicant become incorporated and begin business by June 30, 2003, which time period may be extended upon petition at the sole discretion of the Board.
IN TESTIMONY WHEREOF the members of the Board hereby affix their names at Boston this 13th day of November, Two Thousand and Two.
| Thomas J. Curry Commissioner of Banks | |
| Alan L. LeBovidge Commissioner of Revenue | Board |
| Shannon P. O'Brien Treasurer and Receiver-General |