Fleet Financial Group Inc. announced Tuesday it has completed an agreement to merge with Shawmut National Corporation, forming the ninth-largest financial institution in the United States.
The merger, valued at $3.7 billion, is still contingent on approval by federal and state banking regulators and shareholders of both companies.
Both Fleet and Shawmut currently have branches in Hanover, but officials say it is still too early to say what the implications will be for bank users.
"I certainly can't speculate with regards to anything but I can tell you that this deal was completed in record time -- eight days -- so, naturally there are specifics that need to be worked out," said Mary Quinn, Fleet's vice president of media relations.
Rick Husband, branch manager Fleet's Hanover office, also declined to speculate on the implications of the merger.
"It is really too early to comment and the situation needs further study," he said.
The new institution will be called the Fleet Financial Group and will be headquartered in Boston, Mass. Fleet currently is centered in Providence, R.I, and Shawmut is located in Boston.
Fleet said its chairman and CEO, Terrence Murray, will be the chief executive of the new bank, and Shawmut's chief, Joel Alvord, would be chairman.
The frequency of bank mergers has increased dramatically in the last several years and this latest merger is just a symptom of that trend, according to New Hampshire state banking experts. Both Fleet and Shawmut have acquired about 50 banks each since 1982.
"I think we have to get used to the fact that banking is going to have to continue consolidating so that it can continue to stay competitive," Chris Gallagher told the Associated Press. Gallagher is a lawyer for the New Hampshire Bankers Association.
According to a press release issued jointly by Fleet and Shawmut, the merger will force the elimination of 3,000 jobs nationwide, including 200 to 300 New Hampshire jobs.
Once the streamlining is complete, Fleet said it expects to have about 900 branches nationwide. The new corporation will have $81.4 billion in total assets and about $50 billion in deposits.
Plans call for each share of Shawmut common stock to be exchanged for about 0.9 shares of newly issued shares of Fleet common stock on a tax-free basis. The new stock will pay a dividend of $0.40 per share, which is the dividend that Fleet currently pays.
