Bank Attorney Cautions on GFA/Monadnock Repeats
The planned buyout by GFA Credit Union in Massachusetts of a New Hampshire bank could pave the way for others but capital issues still remain a challenge, a Washington attorney representing the bank said Friday.
Asked for comment on progress of the proposed GFA purchase of the $83 million Monadnock Community Bank, Richard Garabedian, a partner at Luse Gorman Pomerenk & Schick, said he agrees with other parties in the transaction that credit union and bank regulators have so far been satisfied with responses on the details surrounding the $6.4 million cash purchase
“This transaction is the right size and relationship between the thrift and the bank but there can be an issue for other deals because it has to involve cash,” Garabedian said, citing the industry’s capital constraints.
The proposed purchase by the $353 million GFA of Gardner, Mass., of the ailing Monadnock of Peterborough cleared a major hurdle on Thursday with approval by Monadnock shareholders.
“We’ve had some interest by other credit unions thinking about pursuing similar transactions but I really don’t anticipate a floodgate opening,” Garabedian said.
Both GFA and Monadnock have said they expect the transaction to win final regulatory approval by the end of the third quarter.