IPSWICH — Brookline Bank signed an agreement yesterday to purchase the First National Bank of Ipswich for $19.7 million.
First National's six branches are all expected to remain open, including the one on Martin Street in Essex. The bank will operate as a subsidiary of Brookline Bank, keeping its name and chief executive officer, Russ Cole, who said no immediate layoffs are planned.
"It allows us to focus on what we really do well, which is taking care of our customers at a local level," Cole said of the sale. "From my perspective, for these types of transactions — the opportunity to partner with Brookline Bank, who brings a tremendous amount of financial strength to us but also values and respects the local franchise we have here in Ipswich — is as good as it gets."
Brookline Bank has 20 branches in Brookline and west of the city; First National has one Boston branch and five in the Ipswich area.
The sale is subject to regulatory approval and the agreement of Ipswich bank stockholders to sell their shares. Under the sale agreement, First National shareholders will receive $8.10 for each share of common stock.
The sale is expected to go through in the first quarter of 2011.
"We think that Russell Cole has done a nice job of transitioning and refocusing the bank on core commercial banking activities. We think there's good opportunity to serve the marketplace of the North Shore," said Paul Bechet, chief financial officer for Brookline Bank.
Cole said there are "no immediate plans" for employee layoffs.
"There's always a possibility there will be some (layoffs)," Bechet said. "We are keeping the (Ipswich) bank on a standalone basis, but there will be some overlap. Any departures will be far less than accustomed to in a typical acquisition process."
In 2005, Brookline Bank purchased Medford Cooperative Bank and its parent, Mystic Financial Inc.
Bechet said Cole will keep his responsibilities leading the Ipswich bank.
"With stronger capital and resources of the combined bank, he'll have more time to focus on the marketplace and grow business," Bechet said.
Cole stepped into the role of president, CEO and director in 2006 as Donald Gill resigned. He had worked as president of the northern division of the bank since 2004.
"The combination of the two banks will help to grow both of the franchises," Bechet said. "(First National of Ipswich) is a long-established, community commercial bank, in existence since 1892. Its footprint is located in very attractive communities. The bank has a nice core building of business lending and deposit relationships."
Brookline BankFirst National Bank of Ipswich
Assets (as of Sept. 30)$2.7 billion$267 million
Sources: Brookline Bank