Union Savings Bank has filed an application with the Connecticut Department of Banking to reorganize into a mutual holding company in a move that would give the bank “flexibility in the future,” according to president and CEO Cindy Merkle.
The reorganization will have no impact on the bank’s customers or employees, Merkle said.
“Customers will have the same accounts with the same numbers and the same commitment from us,” she said.
Reorganizing into a holding company allows banks more options to raise capital while remaining a mutual and community-oriented bank.
“We don’t have plans to do anything at the moment, but the time to plan is now, not when we need to,” Merkel said regarding the ability to raise capital through additional avenues. “The time to do this is in a good economy.”
Union Savings Bank, a state-chartered mutual savings bank, filed the application Aug. 20. It would reorganize as a capital stock savings bank, according to a filing with the state’s Department of Banking.
Merkle said the move will be put to a vote with the bank’s corporators and then depositors later this fall. She hopes to have the reorganization completed by the end of the year.
Newtown Savings Bank filed a similar application in the summer of 2016 and became a holding company in January of 2017. It received unanimous approval by its board of directors and majority support from its depositors.
“It is a source of comfort to know that the bank now has all the tools it needs to remain an independent mutual organization for generations to come,” then Newtown Savings Bank President and CEO John Trentacosta wrote in the bank’s 2016 Annual Report.
Merkle said the reorganization would not affect Union Savings Bank’s commitment to the greater Danbury community. Union Savings Bank sponsors several events each year, including this weekend’s Taste of Danbury.
Earlier this year, the bank held a community fair on Main Street in Danbury where nonprofit groups set up booths and Union Savings Bank employees talked with representatives to see which organizations they may want to become involved with.
United Savings Bank was founded in 1866. The Union Savings Bank Foundation, which was established in 1998, distributed more than $140,000 in grants to 14 nonprofits last year.
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