The $133 million-asset parent of Gouverneur
Savings and Loan Association applied for deposit insurance with the Federal
Deposit Insurance Corp. for the proposed GS&L Municipal Bank.
Gouverneur said in the application
that it hopes to form the proposed bank in advance of its purchase of the $85
million-asset Citizens Bank of Cape Vincent. The deal was announced on Jan. 4; Gouverneur said in the application it hopes to close the acquisition in the
second quarter.
Gouverneur “has historically
considered the municipal deposit market as an opportunity to help diversify [its]
funding mix and to enhance its ties to the communities that it serves,” the application
said. “The proposed acquisition of [Citizens Bank] has accelerated this
previously identified strategic objective.”
New York state law bars mutuals from
working with municipalities, and Citizens Bank has about $24.2 million of municipal deposits on its balance sheet.
Seneca-Cayuga Bancorp (now Generations Bancorp NY) applied in
2018 to create Generations Commercial Bank so it could accept deposits from
municipalities and other public entities. The bank opened in early January.
Rhinebeck
Bancorp in Poughkeepsie, N.Y., and Dime Community
Bancshares in Brooklyn, N.Y., considered taking similar routes. Dime
withdrew its application after deciding it would be difficult to gain traction
as a new entrant.
Gouverneur
said it plans to capitalize the municipal bank with $2.5 million. The board and
management team would largely be the same as that of Gouverneur Savings.
Gouverneur
asked the FDIC to approve its application by June 1 so it can complete the
acquisition on time.
No comments:
Post a Comment