Decision relative to the application of Benjamin Franklin Bancorp, M.H.C., Franklin, Massachusetts and certain related entities to acquire Chart Bank, A Cooperative Bank, Waltham, Massachusetts

By the Division of Banks

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Benjamin Franklin Bancorp, M.H.C. ("Benjamin Franklin" or the "Petitioner"), Franklin, Massachusetts has petitioned the Board of Bank Incorporation (the "Board") pursuant to the provisions of Massachusetts General Laws chapter 167A, sections 2 and 4 to acquire Chart Bank, A Cooperative Bank ("Chart Bank"), Waltham, Massachusetts. Benjamin Franklin is the mutual holding company for Benjamin Franklin Bank, Franklin, Massachusetts. In order to facilitate this multi-step transaction to acquire Chart Bank, Benjamin Franklin is converting from a mutual holding company to a stock holding company under Massachusetts General Laws chapter 167H and regulations of the Division of Banks (the "Division"). In a related transaction that is subject to the jurisdiction of the Division, Chart Bank will be merged with and into Benjamin Franklin Bank with the banking offices of Chart Bank becoming banking offices of Benjamin Franklin Bank.

Notice of the petition by Benjamin Franklin was published as directed by the Board thereby affording opportunity for interested parties to submit comments. A public hearing relative to this application was held by the Board on January 5, 2005 and the period for filing comments expired on February 4, 2005. The Board reviewed the application, comments received at the public hearing and all related documents in accordance with the statutory criteria of whether competition among banking institutions will be unreasonably affected and whether any net new benefits as well as public convenience and advantage would be promoted by approval of the proposed transaction. The Board notes that one commenter submitted oral and written testimony particularly relevant to the conversion component of this multi-step transaction wherein the mutual holding company will convert into a stock holding company. That transaction is before the Division and the commenter has received a response from the Division. The record of performance under the Commonwealth's Community Reinvestment Act ("CRA") by Benjamin Franklin Bank and Chart Bank also were factors considered by the Board.

One provision of law requires the Board to have received notice from the Massachusetts Housing Partnership Fund (the "MHPF") that satisfactory MHPF arrangements for the proposed transaction have been made by Benjamin Franklin pursuant to section 4 of chapter 167A of the General Laws and guidelines adopted by the MHPF. The Board has received notice from the MHPF, in a letter dated January 20, 2005, that arrangements satisfactory to it have been made for the transaction.

Benjamin Franklin is a mutual holding company established in 1996 under chapter 167H of the General Laws in conjunction with the reorganization of Benjamin Franklin Bank into that corporate structure. Its operations have been limited to ownership of Benjamin Franklin Bank. As part of this multi-step transaction to acquire Chart Bank, Benjamin Franklin is converting to a stock holding company under said chapter 167H and regulations of the Division. The Board notes that a charitable foundation is being formed in connection with the mutual to stock conversion. At September 30, 2004, Benjamin Franklin had total assets of approximately $518 million. Benjamin Franklin Bank, formerly known as Benjamin Franklin Savings Bank, is the subsidiary banking institution in stock form resulting from the 1996 reorganization. It operates from six banking offices located in Bellingham, Foxboro, Franklin (2), Medfield and Milford. Benjamin Franklin's primary business is taking deposits and making residential and commercial mortgage loans, construction loans, commercial loans, home equity loans and other consumer loans.

Chart Bank is a Massachusetts-chartered co-operative bank in stock form. It operates three banking offices, two in Waltham and one in Newtonville. Chart Bank's primary business consists of taking deposits and making residential and commercial mortgage loans, construction loans, and other consumer and commercial loans. At September 30, 2004, Chart Bank had total assets of $256.8 million.

The conversion of Benjamin Franklin from a mutual holding company to a stock holding company would be the fourth such transaction. The record of this transaction reflects that the Corporators of Benjamin Franklin and the stockholders of Chart Bank have each approved the applicable parts of this transaction.

Materials have been submitted to address the issue of whether competition among banks will be unreasonably affected by the proposed transaction. Some of that analysis is detailed according to various tests relative to the size of each institution and its competitors within delineated markets used by federal agencies. Benjamin Franklin Bank currently operates in communities southwest of the City of Boston. Petitioner submits that the market served by Chart Bank is a logical geographic extension of its current market area and will extend it toward the northeast. The only overlap in the banking markets in which Benjamin Franklin Bank and Chart Bank operate, as defined by the Federal Reserve Bank of Boston, is the Boston Banking Market. Using standard merger guidelines, Petitioners calculate the proposed merger as having a de minimis effect on competition in the Boston Banking Market. It is the position of the Board to consider a transaction in the light of its impact on the citizens, communities and banking structure in the Commonwealth on a community by community basis instead of by variously grouped markets or counties. The Petitioner is committed to maintaining Chart Bank's existing branch offices following the merger. Additionally, Petitioner expects to expand its branch network over the next few years as it seeks to grow the Chart Bank market area and to fill in the gap between the two banks' existing branch networks. Upon review of the information in Petitioner's filing, the Board's analysis of the competitive impact of this transaction do not preclude its approval.

The Board has also considered whether public convenience and advantage will be promoted by this transaction. As described in the filed documents and at the public hearing, the Petitioner believes the statutory test is met in a number of ways. As a significantly larger financial institution, Benjamin Franklin offers a greater variety of products and services than Chart Bank including some which are not offered by Chart Bank, such as investment and financial services and Savings Bank Life Insurance. Chart Bank customers will benefit from the larger lending limit available through the combined institution. Additional services and proposed programs are detailed in the application and provide the basis for determining that this statutory test and a showing of net new benefits has been met.

The record of performance under CRA by the subsidiary banks in a bank holding company transaction is also a consideration by the Board. For financial institutions not directly under the jurisdiction of the Commonwealth, the Board initially looks to the publicly available descriptive rating and evaluation by a federal or another state's banking regulatory agency. Such review for state-chartered banks such as Benjamin Franklin Bank and Chart Bank includes examination by personnel of the Division as well as analysis of concerns received from a bank's community and a bank's response to those concerns fairly raised. The Board has noted that both Benjamin Franklin Bank and Chart Bank have "Satisfactory" ratings in their most recent examination of performance under CRA. Accordingly, the Board's view of this factor is consistent with approval.

The application states that upon consummation of the transaction, six current directors of Chart Bank will be added to the Board of Directors of Benjamin Franklin, as converted into a stock form holding company. Following the transaction, which includes the conversion of Benjamin Franklin, all regulatory capital standards will continue to be met. Upon review, financial, managerial and operational considerations support the petition.

Conclusion

Based on the record on this matter including the testimony received at the public hearing considered in light of all relevant statutory and administrative requirements, the Board finds that competition among banking institutions will not be unreasonably affected, that public convenience and advantage will be promoted by consummation of the proposed transaction and that records of performance under CRA by the banks involved in this transaction are consistent with its approval. Therefore, in accordance with these findings and pursuant to the statutory authority cited herein, the Board hereby approves the application and authorizes Benjamin Franklin to become a bank holding company and acquire up to one hundred percent of the stock of Chart Bank.

The approvals herein are subject to the condition that all related transactions are completed within one year of the date of this Decision.

Steven L. Antonakes Commissioner of Banks
Alan L. LeBovidge Commissioner of Revenue	Board of Bank Incorporation
Timothy P. Cahill Treasurer and Receiver General
March 30, 2005 Date