For Immediate Release - August 16, 2011

Grossman Extends Application Deadline for Small Business Banking Partnership

Vigorous Response from Community Banks Spurs Deadline Shift

Citing a strong response from the small banking community, Treasurer Steven Grossman today announced that he is extending the deadline by which community banks must apply for membership in the Small Business Banking Partnership from September 1, 2011 to January 1, 2012.

"The response to the Partnership has outpaced even our optimistic expectations - this has really proven to be a win-win-win for government, community banks, and small businesses," said Treasurer Grossman. "It directs additional deposits into Massachusetts banks, encouraging them to lend to Massachusetts small businesses. The Partnership puts the reserve resources of the Treasury to their optimal use, creating jobs, opportunity, and prosperity throughout the Commonwealth."

The Small Business Banking Partnership moves Treasury cash reserve funds typically held by large national and international financial institutions and deposits them in amounts of up to $5 million in Massachusetts banks. In exchange for the infusion of new deposits, the banks sign a Memorandum of Understanding (MOU) signaling their intent to enhance their loan portfolios to small credit-worthy Massachusetts businesses.

The first deposits were made in early May of this year, and the Treasury quickly surpassed the initial $100 million that had been set aside for the program, prompting it to designate another $100 million to the initiative. Presently, the Partnership has over $121 million on deposit with 27 community banks across the Commonwealth, many of which have already extended new loans leveraged through the deposits to small businesses.

In addition to the banks with Treasury money on deposit, 24 banks statewide have made a commitment to participate in the Small Business Banking Partnership and are in varying stages of signing up for the program. Treasurer Grossman said he has been travelling across the state to promote the program with bank officials, with an eye toward ensuring that all community banks are aware of the benefits of the Partnership before the application period closes on the newly extended deadline of January 1, 2012.

"We're confident that the Partnership will continue to generate interest, and we wanted to give as many banks as possible an opportunity to sign up, strengthen their business, and assist us in our job creation goals," said Grossman.

All deposits that the Treasury makes in these community banks are protected through either insurance or collateral, and the interest rate on the money is comparable to what the Commonwealth receives at out-of-state financial institutions.

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A list of community banks participating in the Partnership is attached.

SMALL BUSINESS BANKING PARTNERSHIP
PARTICIPATING BANKS AS OF AUGUST 16, 2011

Arlington

Leader Bank

Ayer

North Middlesex Savings Bank

Belmont

Belmont Savings Bank

Boston

East West Bank

Boston

Mercantile Bank and Trust Company

Chicopee

Chicopee Savings Bank

Everett

Everett Cooperative Bank

Fall River

Bank Five

Fall River

Citizens Union Savings Bank

Gloucester

BankGloucester

Haverhill

Pentucket Bank

Haverhill

Haverhill Bank

Hyannis

Bank of Cape Cod

Leominster

Fidelity Bank

Medford

Century Bank

Newburyport

Newburyport Five Cents Savings

Orleans

Cape Cod Five

Reading

Reading Cooperative Bank

Rockland

South Coastal Bank

South Weymouth

South Shore Savings Bank

Springfield

Nuvo Bank

Taunton

Bristol County Savings Bank

Taunton

Mechanics Cooperative Bank

Wakefield

The Savings Bank

Walpole

Walpole Cooperative Bank

Westfield

Westfield Bank

Worcester

Bay State Savings Bank