Story updated with a comment from a NewAlliance spokesperson. NEW YORK ( TheStreet) -- Connecticut Attorney General Richard Blumenthal is raising questions about a proposed $1.5 billion acquisition of New Haven, Conn.-based NewAlliance Bancshares ( NAL) by First Niagara Financial Group ( FNFG), which is headquartered in Buffalo, N.Y. In a letter Thursday to the CEOs of both banks, Blumenthal cited Connecticut laws stating the merger of a state chartered bank, such as NewAlliance, and a federally charter one like First Niagara "may only be approved where...the benefits to the public outweigh any possible adverse effects," according to the letter. The letter also states that laws require the deal to "comply with sound public policy...and benefit the state of Connecticut." Blumenthal has asked the executives for extensive information on expected benefits of the deal to the Connecticut, which he outlines in 13 bullet points. Among concerns he raises are potential job losses and less personal attention for borrowers and homeowners in the state. "Unlike many other banks, my office can find no reference on
First Niagara's website to programs that help borrowers avoid foreclosure," Blumenthal writes. A NewAlliance spokesman sent along a prepared statement that said it expects Blumenthal will "welcome the merger," once he becomes familiar with First Niagara's track record, including a "commitment to local decision-making." First Niagara announced last month that it would acquire competing regional lender NewAlliance for $1.5 billion. Blumenthal's inquiry recalls one by Massachusetts Secretary of State William Galvin in 2005 regarding Procter & Gamble ( PG - Get Report)'s acquisition of Gillette. Also concerned about lost jobs in the state, Galvin argued the price being offered by P&G was insufficient, and he challenged the "fairness opinion" on the deal provided by Goldman Sachs ( GS - Get Report) and UBS ( UBS - Get Report). The $57 billion deal eventually closed at the price initially agreed upon. -- Written by Dan Freed in New York.