BOSTON - Berkshire Hills (NYSE:BHLB) Bancorp, Inc. (NYSE: BHLB) has entered into agreements to sell 10 branches in upstate and eastern New York to three different financial institutions. This move is part of the company's strategy to streamline operations and focus on core markets within New York.
The transactions, which are expected to be completed by the end of the third quarter of 2024, involve approximately $485.5 million in deposits and $60.5 million of residential mortgage and consumer loans.
The sales will reduce Berkshire's branch network from 96 to 86 locations. Hudson (NYSE:HUD) Valley Credit Union will acquire eight branches in Albany, Saratoga, Schenectady, and Columbia counties, while Glens Falls National Bank and Trust Company and Pathfinder Bank will each purchase one branch in Whitehall and East Syracuse, respectively.
Nitin Mhatre, CEO of Berkshire Bank, emphasized that the sales will not materially increase borrowings and are anticipated to be neutral to the company's earnings outlook for 2024. He stated, "The proposed sales will concentrate our overall geographic footprint and lower our expense run rate, while strengthening focus in our core New York markets."
David Rosato, CFO of Berkshire, added that the transactions will allow the bank to exit these branches without incurring severance or real estate costs, thereby reducing expenses and contributing to long-term profitability. The company remains committed to its core New York markets, where it will continue to operate 16 branches and maintain relationships with existing clients.
The sales are subject to customary regulatory approvals and associated system conversions. Berkshire's financial advisor for the branch sale was RBC (TSX:RY) Capital Markets LLC, and legal counsel was provided by Luse Gorman, PC.
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