Charter One Buys St. Paul Bancorp
CLEVELAND (AP) _ Charter One Financial Inc. will buy St. Paul Bancorp, Inc. in a stock swap valued at $1.2 billion, the two bank holding companies said Monday.
St. Paul shareholders will receive .945 share of Charter One stock for each share of St. Paul stock they own.
The merger is expected to save money by eliminating duplicative operations. There will be job cuts, the companies said, but provided no details.
The deal is expected to close in the fourth quarter of 1999 and result in one-time, after-tax charges of between $55 million and $70 million.
St. Paul Bancorp, which operates 60 St. Paul Federal Bank branches in the Chicago area, has assets of about $6 billion.
Cleveland-based Charter One Bank has $24.6 billion in total assets and 340 branch locations in Ohio, Michigan, New York, Massachusetts and Vermont.
Additionally, Charter One Mortgage Corp., a mortgage banking subsidiary, operates 40 loan production offices across 12 states, and Charter One Auto Finance, an auto finance subsidiary, generates loans in nine states.
``Chicago is clearly the cornerstone of the Midwest, and combining it with our anchors in Cleveland and Detroit gives us a solid footprint in the region,″ said Charles John Koch, Charter One’s chairman and chief executive.
Shares of Charter One closed Monday at $30.81 1/4, up 53 1/8 cents, on the Nasdaq Stock Market. St. Paul closed at $24.68 3/4, up 3 1/8 cents, also on the Nasdaq.
Joseph Scully, St. Paul chairman and chief executive, said that upon completion of the merger, all retail banking branches will remain open and that they will retain the St. Paul name.
The transaction has been approved by the boards of directors of both companies and is subject to shareholder and regulatory approval.