Worcester Business Journal

www.wbjournal.com December 7, 2015 • Worcester Business Journal 7 CENTER FOR BUSINESS AND INDUSTRY ENHANCING THE SKILLS OF YOUR WORKFORCE The Center for Business and Industry at Worcester State University provides quality, customized, flexible workforce training for our business and nonprofit partners. • We offer credit and non-credit training options. • We deliver training at your site, online, on WSU's campus, or a combination. • We provide assistance accessing training grants. • We are Authorized Partners of Everything DiSC® and Five Behaviors of a Cohesive Team®. Learn more: worcester.edu/cbi cbi@worcester.edu | 508-929-8787 ▲ "Working in partnership with Worcester State University has been a rewarding experience for Spectrum. The education and opportunities afforded to our employees have been life changing." –Stacy Flanagan, VP of Human Resources Spectrum Health Systems, Inc. "I can compete so well and so easily against (national banks) in some ways because you can call me on my cell phone on a Sunday afternoon," Hewitt said. "Try to do that with any of the large banks." There are drawbacks to merging holding companies rather than under- taking a traditional merger. Fidelity Bank President and CEO Ed Manzi Jr. explored merging holding companies before pursuing a traditional merger with Barry Savings Bank. The type of merger has to make sense for the situation, he said. Fidelity's establishment of a $1.5-million com- munity foundation for the Barre, Paxton, and Princeton area because its traditional merger allowed the result- ing entity to set aside more money for the community than if a non-tradition- al merger had been pursued. "It's very deal specific. You have to take this lens of structure-follows-strat- egy and what works best for the com- munity and bank and come up with a specific answer for those sets of facts," Manzi said. There is also the question of effi- ciency. While there are certainly more efficiencies by having two banks shar- ing resources under a joint holding company, there are still inherently some redundancies, said Sosik. This is a part of the tradeoff of retaining the franchise value of the individual bank names and customer relations. "It is an imperfect method if you are looking to extract all the efficiencies. It is a perfect method if you are looking to preserve the legacy and effectiveness of the traditional brands," Sosik said. There are also additional nuances that must be worked out with a holding company merger that do not occur to the same degree as a traditional merger, such as the name of the holding com- pany, the makeup of the board, safe- guards against a bank takeover. These talks as having the potential to be very, very sticky, Sosik said. Once all those details are worked out, it puts the overarching holding compa- ny in a position ready to add more banks, he said. This is an opportunity for the banks already under the hold- ing company, who could have access to even more assets as additional banks are added, but also for banks who have anoth- er option rather than being com- pletely absorbed in a traditional merger, Sosik said. Moving forward, all three bank pres- idents foresaw additional mergers in the current tough banking environ- ment. Whether they will be traditional mergers or a joing of holding compa- nies will depend very much on each situation. "The whispers and the chatter in our industry seem to indicate a lot of talk among banks about mergers or mutual holding companies," Sosik said. n Easthampton Savings Bank was able to retain its name and tie to its community customers while growing its financial backing in an increasingly competitive banking industry by merging its holding company with that of Hometown Bank. Matthew Sosik, Easthampton Savings Bank president and CEO P H O T O / C O U R T E S Y

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