People's United Financial, Inc. To Expand Into Long Island And Deepen Presence In Greater Boston

BRIDGEPORT, Conn., July 15 /PRNewswire-FirstCall/ -- People's United Financial, Inc. (Nasdaq: PBCT), the holding company for People's United Bank, announced today definitive agreements to acquire two banks in markets contiguous to its existing footprint. The banks are Bank of Smithtown, a subsidiary of Smithtown Bancorp, Inc. based in Hauppauge, New York (Nasdaq: SMTB) and RiverBank, a subsidiary of LSB Corporation based in North Andover, Massachusetts  (Nasdaq: LSBX).

The Smithtown Bancorp, Inc. acquisition is valued at approximately $60 million, with approximately half that amount being paid in cash and the balance in the form of shares of People's United common stock. At March 31, 2010, Smithtown Bancorp had total assets of $2.43 billion, total deposits of $1.87 billion and 30 branches, 29 of which are on Long Island and one in New York City.

The LSB Corporation acquisition is an all-cash transaction valued at $96 million. At March 31, 2010, LSB Corporation had total assets of $807 million, total deposits of $504 million and seven branches, five of which are in the greater Boston area, and two in southern New Hampshire.

Both transactions are subject to approval by bank regulatory authorities and by the shareholders of Smithtown Bancorp and LSB Corporation, respectively.  People's United shareholder approval is not required for either transaction.

People's United expects the transactions to be accretive to operating earnings in 2011 and to have an IRR greater than 15%. Both transactions are expected to close in the fourth quarter 2010.

"We are pleased that Bank of Smithtown and RiverBank are joining forces with People's United Bank," said Jack Barnes, interim chief executive officer of People's United. "Both banks will be valuable additions to the People's United franchise. Bank of Smithtown will extend our reach into Long Island and New York City, augmenting our leading market presence in Fairfield County and our growing franchise in Westchester County.  

"The RiverBank acquisition expands our presence in the greater Boston and southern New Hampshire markets," he continued. "Earlier this year, we entered the greater Boston area with our FDIC-assisted purchase of Butler Bank, located in Lowell, Massachusetts.  The former Butler Bank and RiverBank franchises will be supported by two new Boston branches – one located in the Prudential Center, and the other located in the Financial District.  Both Boston branches are expected to open by year end.

"We look forward to working with our new colleagues on Long Island and in New York City, Massachusetts and New Hampshire," said Barnes. "Our new customers can count on seeing the same familiar faces at their branches as our objective is to maintain the excellent rapport our new colleagues have with their customers."  

The definitive agreements have been approved by the respective boards of directors of People's United Financial, Inc., Smithtown Bancorp, Inc. and LSB Corporation, as applicable.