Bangor Savings seeks to become mutual holding company

BANGOR – Bangor Savings Bank is appealing to its customers to vote in favor of its proposed structural conversion from a mutual savings bank to a mutual holding company.

The reorganization will facilitate future acquisitions and give the bank the option to raise capital by issuing securities or selling stock, although there are no stock sales planned for the future, according to president and CEO James J. Conlon.

“We believe this reorganization will help ensure the long-term future of the bank by protecting its ability to remain an independent savings bank, maintaining its mutuality and creating a better corporate organizational structure for future growth,” Conlon said. “We’re posturing ourselves to be headquartered in Bangor for the foreseeable future.”

Conlon said the restructuring would have absolutely no effect on the bank’s operations, accounts, loans, trustees, officers or staff.

At present, Bangor Savings Bank is a mutual savings bank, meaning it is regulated under state and federal law for the benefit of its depositors. A local board of trustees makes major decisions independently of the legal owners.

Under the proposed structure, Bangor Savings Bank would create a mutual holding company, Bangor Bancorp., which would own Bangor Savings Bank. The bank would become a stock bank but would issue 100 percent of its stock to the mutual holding company.

The bank’s current nine-member board of trustees would also serve as the directors of the mutual holding company. The trustees have approved the plan unanimously and urge customers to vote for approval, Conlon said.

Bangor Savings Bank is not the first bank to propose such a change, said Chris Pinkham, president of the Maine Association of Community Banks. Pinkham said 15 to 20 percent of all mutual savings banks in the country have become mutual holding companies. Bangor Savings Bank is following in the footsteps of Franklin Savings Bank, Machias Savings Bank, Androscoggin Bank, Norway Savings Bank and most recently, Gorham Savings Bank.

“Bangor Savings is a pretty big bank for the state of Maine and it [the proposal] opens up their options,” Pinkham said.

All regulatory approvals necessary to complete the reorganization are pending and are expected to be obtained, Conlon said.

Customers may vote by mail using a proxy card that the bank plans to send to each customer, or in person at a meeting scheduled for 2:30 p.m. Thursday, Dec. 21, at the bank’s Eames Learning Center, 203 Maine Avenue, Bangor.

For more information, customers may call the proxy information hotline at (877) 266-4805 or 942-5211 Monday through Friday, 10 a.m. to 4 p.m.