Decision  Decision of April 9, 2009

Date:	04/09/2009
Organization:	Division of Banks

• Petitioner: Rockland Trust Company
• Respondent: Division of Banks

Decision relative to the application of Rockland Trust Company, Rockland, Massachusetts to merge with Benjamin Franklin Bank, Franklin, Massachusetts

Rockland Trust Company (the "Petitioner" or "Rockland"), Rockland, Massachusetts, has applied to the Division of Banks (the "Division") for permission to merge with Benjamin Franklin Bank ("Benjamin Franklin"), Franklin, Massachusetts pursuant to the provisions of Massachusetts General Laws chapter 168, section 34D and chapter 172, section 36 under the terms of an Agreement and Plan of Merger dated May 2008 (the "Agreement"). The Agreement, as now structured, provides for the merger of Benjamin Franklin with and into Rockland under the charter, by-laws and name of Rockland Trust Company. The banking offices of Benjamin Franklin will be retained as branch offices after the merger. The transaction initially filed on January 15, 2009 by the Petitioner was for the purchase and assumption of substantially all of the assets and liabilities of Benjamin Franklin whereby Benjamin Franklin would continue operating as a bank under its own charter. The proposed merger is part of a multi-step transaction involving a petition before the Board of Bank Incorporation by the Petitioner's holding company, Independent Bank Corp. ("Independent"), Rockland, Massachusetts, to acquire Benjamin Franklin Bancorp, Inc. ("Bancorp"), Franklin, Massachusetts. Bancorp is the stock holding company of Benjamin Franklin. Other significant aspects of this multi-step transaction are known to the Division and are detailed in the Board of Bank Incorporation transaction approved in a Decision also dated today.

Notice of the Petitioner's application was published and posted, and the time period for interested parties to comment on the transaction has expired. The Petitioner submitted a supplemental filing on February 27, 2009 related to the change in structure of the transaction from a purchase and assumption transaction to a merger. Additional supplemental filings were submitted on February 9, 2009 relative to managerial compensation and on March 13, 2009 relative to a restrictive lease question. The Division received the same singular comment from the public as did the Board of Bank Incorporation. It was from a stockholder of Independent on the holding company aspect of the transaction. All documents and materials related to this transaction have been reviewed. This record has been considered with regard to all applicable statutory standards, which require consideration of, among other things, whether competition among banking institutions will be unreasonably affected by the proposed transaction and whether public convenience and advantage will be promoted. The Commissioner's review of this matter must also take into consideration the involved banks' records of performance under the Community Reinvestment Act ("CRA"), section 14 of Chapter 167 of the General Laws and its implementing regulation 209 CMR 46.00. et. seq.

Rockland, a Massachusetts-chartered trust company, established in 1907, has its main office in Rockland and operates 60 other full service banking offices, all of which are located in Plymouth, Norfolk, Bristol and Barnstable Counties. As of December 31, 2008, Rockland had total assets of $3.6 billion. Rockland's deposits are insured to allowable limits by the Federal Deposit Insurance Corporation ("FDIC"). Rockland offers a full range of community and commercial banking services throughout Southeastern Massachusetts and on Cape Cod.

Benjamin Franklin, a Massachusetts-chartered savings bank, offers banking services through its network of 11 full-service banking offices. These banking offices include its main office and a branch office in Franklin, as well as two branch offices in Waltham and other branch offices in Bellingham, Foxborough, Medfield, Milford, Newtonville, Watertown and Wellesley Hills. Benjamin Franklin, as of December 31, 2008, had total assets of $ 997.8 million. Like Rockland, Benjamin's deposits are insured to allowable limits by the FDIC. However, as a state-chartered savings bank, Benjamin Franklin's deposits in excess of FDIC coverage limits are insured in full by the Depositors Insurance Fund.

Materials have been submitted to address the issue that competition among banks will not be unreasonably affected by the proposed transaction. In analyzing the impact of a proposed transaction on banking competition, the Division considers, but does not rely exclusively on, the guidelines used by federal authorities to review bank mergers. Essentially, these guidelines define relevant markets and measure concentration, which is considered an important indicator of competitiveness. The starting point in the federal analysis is the Herfindahl-Hirschman Index ("HHI"), an arithmetic measure of market concentration that synthesizes the distribution of market shares and the number of banks in an affected market into a single value. In this case, there will be a de minimis increase in the HHI for the geographical areas analyzed. In addition to that analysis, the Division considers the competitive impact of the proposed transaction on a community-by-community basis, as well as on the overall banking structure of the Commonwealth. As stated above, the communities in the primary service area for the merging banks are different. Although some of the banking offices of both banks are located in the same county, Norfolk County, Rockland and Benjamin Franklin do not have any banking offices located in the same city or town. Additionally, the Division has noted that there are numerous banks with banking offices located in the combined primary service area of the merging banks. Therefore, customers of Benjamin Franklin will continue to be able to choose from a variety of banking options. Accordingly, the Division's analysis of the competitive impact of the merger weighs in favor of the proposed transaction.

The application states that, in connection with the merger, the continuing institution's Board of Directors will consist of all of the persons currently serving as directors of Rockland and three directors of Benjamin Franklin. The management of the combined bank is also detailed in the application documents. Economies and service capabilities which would result from the transaction are set out in the submitted documents. Upon consolidation, the continuing bank will meet all required capital standards. Accordingly, upon review, financial and managerial considerations support the application.

As a result of the merger, Rockland indicates that the banking public will benefit in several ways. According to the application, such benefits include an expanded branch office network and a broader range of products and services which will include all of the products presently offered by Rockland. In addition to the enhanced branch office network, customers of Benjamin Franklin will benefit from the wide array of loans, deposits and investment services, as well as several enhanced business products, which will become available to them upon the merger. The additional resources from the merger will facilitate the possible future development of products and services. 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 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. As set out in the application, the continuing bank intends to provide the aforementioned products and services to customers, as well as make capital investments in the form of improvements for its continuing banking offices in connection with the merger. According to the Petitioner, the merger will enhance the continuing bank's financial capability to invest in the communities it serves and to develop new products and services for its customers. The Petitioner has provided information and oral testimony indicating that a large number of Benjamin Franklin employees will be employed by Rockland following the merger and other employees are being encouraged to apply for open positions within Rockland. In addition, transitional assistance, in a variety of forms, will be provided to those employees impacted by the merger. In past Decisions, the Division has recognized that a combined, stronger institution can grow and expand with additional products and services which should also lead to the creation of new jobs. Additionally, Rockland will maintain the banking offices of Benjamin Franklin as branch offices. These and other factors are also cited as support for meeting such criteria.

Related to the issue of public convenience and advantage is the record of performance under CRA by the banks which are parties to this transaction. Such review for a state-chartered bank includes examination of personnel by 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 Rockland and Benjamin Franklin received "Outstanding" and "High Satisfactory" ratings respectively in their most recent CRA performance examinations.

Based on the entire record of this matter and considered in light of all relevant statutory and administrative requirements, the Division concludes that all such requirements have been met and that consummation of the proposed merger would be in the public interest. On the basis of these conclusions, and subject to the conditions set forth below, approval is granted for Benjamin Franklin to merge with and into Rockland in conformity with the Agreement and pursuant to Massachusetts General Laws chapter 168, section 34D and chapter 172, section 36.

The approval granted herein is subject to the following conditions:

1. that the merger of Benjamin Franklin and Rockland shall not become effective until a Certificate, signed by the Presidents and Clerks or other duly authorized officers of the banks involved in the merger, indicating that the institution has complied with the provisions of Massachusetts General Laws chapter 168, section 34D and chapter 172, section 36, has been returned with my endorsement thereon;
2. that such Certificate and Articles of Merger shall be filed with the Secretary of State of the Commonwealth of Massachusetts; and
3. that the proposed merger shall be consummated within one year of the date of this Decision.

April 9, 2009
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Date


Steven L. Antonakes
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Commissioner of Banks