Hartford Business Journal

22 Hartford Business Journal | March 8, 2021 | HartfordBusiness.com O ut-of-state banks from Massachusetts and New York are making big moves in Connecticut that will reshape the competitive landscape, and they're using different strategies to grow their local footprints. Upstate New York's M&T Bank, with $142.2 billion in assets, is making the biggest splash with its $7.6 billion planned acquisition of Bridgeport-based People's United Bank, a deal that when completed will give it 183 branches and $27.8 billion in deposits in Connecticut alone. (Currently M&T has just nine branches in the state.) On the other hand, M&T's neighbor in Norwich, N.Y., NBT Bank, is pursuing a de novo strategy in Connecticut, dipping its toe in the waters with new branches in Glastonbury and potentially West Hartford. Finally, Massachusetts-based PeoplesBank is taking a hybrid approach. After entering the Connecticut market in late 2018 with its $60 million purchase of the First National Bank of Suffield, it's now asking regulators to approve its first de novo branch in posh West Hartford Center, at 102 LaSalle road — the former location of a United Bank branch. The three banks range widely in size, but share at least one thing in common: They see opportunity in the state's increasingly consolidated banking landscape. Opportunity knocks PeoplesBank CEO Thomas Senecal said he's been pleased with his bank's Connecticut business and now hopes to open three or four new branches here in the next few years, all clustered in the northern half of Hartford County, with the aim of further growing his $3.3 billion institution's commercial loan portfolio and retail deposits. "Connecticut is very similar to our other markets, we've had some great success there," Senecal said. "Overall I'm really happy with the results." At NBT, the Glastonbury and West Hartford offices would be the first brick-and-mortar footholds for the bank since it launched a commercial lending business here more than a year ago. "The pipeline has been very, very strong," NBT's Connecticut Regional President Andreas Kapetanopoulos said of his bank's local loan experience thus far. "Despite COVID, we're seeing a lot of activity." For M&T, its pending acquisition will give it a dominant Connecticut market share and a deeper Northeast footprint. People's United has the second- largest deposit market share in Connecticut, behind only Bank of America. "The merger will produce a bank with a leadership position in small and mid-sized markets throughout the Northeast, complemented by a strong presence in four of the 20 largest [metro areas] in the country, ranging from Washington, D.C. to Boston," said M&T's CFO Darren King during a recent investor call. However, Connecticut's wealth is clearly also part of the allure, and M&T is hoping to cross-sell services from its wealth management arm, Wilmington Trust. "Many of the People's United markets that are new to M&T offer access to an affluent customer base, where leading wealth management capabilities can be leveraged through Wilmington Trust," King said. Contrasting strategies NBT's foray out of its home state and into New England over the past 12 years has been somewhat unique in that its leaned more heavily on the more organic — and often slower — strategy of opening de novo branches, rather than acquiring an existing bank in those states. It's not that NBT hasn't done acquisitions, but its market entries into Vermont, New Hampshire and now Connecticut — where it perceives opportunities for middle- market and small-market lending in a rapidly changing banking landscape — have been from the de novo playbook. The strategy typically involves hiring commercial lenders in a new market ahead of establishing any full-service branches, and it contrasts with PeoplesBank's acquisition approach. Kapetanopoulos said NBT sees plenty of opportunity in Connecticut, but that management also wants to be deliberate about its new investment. "We want to make sure we grow wisely," Kapetanopoulos said. "The formula for what we're doing, there's nothing magical about it, it's pretty straight forward as long as you stick to the plan. And then you have to deliver." PeoplesBank, which like NBT had commercial customers in Out-of-state banks deepen Greater Hartford footprints By Matt Pilon mpilon@hartfordbusiness.com FOCUS: Banking & Finance C onsolidation has been a trend in Connecticut's banking industry for years, but deals made by Bridgeport- based People's United Bank since 2018 are playing a major role in reshaping Greater Hartford's competitive landscape, especially as it prepares to be taken over by New York-based M&T Bank. For one, People's United's deals — which have included the acquisitions of Farmington Bank and United Bank — have paved the way for out-of-state lenders to increasingly eye and grow in the market. For example, NBT's pending Glastonbury branch and PeoplesBank's proposed West Hartford branch were both previously United Bank branches. That's no surprise, since People's United closed 18 branches after it bought United Bank, leaving ready-made nests for numerous other lenders who have since stepped in to buy or lease them. NBT entered the Vermont banking market in 2009, sensing opportunity after People's United acquired Burlington-based Chittenden Corp., a deal that brought Chittenden exec Jack Barnes to People's United, where he was named CEO soon after. For PeoplesBank, the M&T deal also has implications for what Senecal says is a long- running brand confusion for some customers. After acquiring two western Massachusetts lenders in 2008, People's United Bank was sued by PeoplesBank, which was seeking to block the Bridgeport-based lender from using its name in that market, claiming it would cause customer confusion and damage its brand. The effort was ultimately unsuccessful, and Senecal says People's United customers will still occasionally show up at one of his branches thinking they are the same bank. "I'm not sure the confusion ever fully went away," he said. There's no ill will, he insists, but he's looking forward to the People's United brand potentially going away after the bank is officially acquired by M&T later this year. Northeast banking is a small world By Matt Pilon mpilon@hartfordbusiness.com PHOTO | CONTRIBUTED PeoplesBank CEO Thomas Senecal plans to potentially double his Mass.-based bank's branch footprint in Connecticut over the next two years. PHOTO | CONTRIBUTED PeoplesBank is opening a branch in West Hartford Center. Wittmann Battenfeld, Torrington, CT Napoli Retail, Southington, CT Since AKDO, Bridgeport, CT Building That Wittmann Torrington, Napoli Southington, AKDO, Bridgeport, Building That

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