Boston-Based Banks Berkshire Hills and Brookline in Talks to Combine
Each has about $12 billion in assets; a deal could be finalized as soon as next week
Boston-based regional bank companies Berkshire Hills Bancorp BHLB -0.20%decrease; red down pointing triangle and Brookline Bancorp are in talks to combine, according to people familiar with the matter.
The details
The deal would merge the two banks, which each have about $12 billion in assets, and could be announced as soon as next week, assuming talks don’t fall apart.
Berkshire Hills had a market value of around $1.3 billion as of midday Friday, while Brookline’s was just over $1 billion.
The rationale
Berkshire has more than 80 branches throughout New England and New York. Brookline operates several banks throughout the Northeast, each with between a dozen and roughly two dozen branches: Brookline Bank in Boston, BankRI in Providence, R.I., and PCSB Bank in the lower Hudson Valley in New York.
Both banks have exposure to commercial real-estate loans, which have come under pressure.
The context
More regional banks have started to consider whether to partner up to address commercial real estate, technology and other challenges, especially midsize and small institutions that don’t enjoy the scale and diversity of megabanks.
Bank executives are optimistic that President-elect Donald Trump will take a friendlier approach to mergers in the industry and ease capital and consumer regulations.
Over 100 bank deals with an aggregate value of more than $14 billion have been announced so far this year, according to S&P Global Market Intelligence data. That is compared with $4 billion worth of transactions announced last year.