Two Massachusetts banks have converted to state charters, putting the banks under the regulation of the Massachusetts Division of Banks.
Brookline Bank has converted from a federally chartered savings bank to a state-chartered savings bank.
The First National Bank of Ipswich has converted from a national bank to a Massachusetts-chartered trust company. These are the first conversions of this type since 2001.
Brookline Bank and The First National Bank of Ipswich are wholly owned subsidiaries of Brookline Bancorp Inc., a bank holding company with consolidated assets of $4.9 billion.
Before the conversions, Brookline Bank and The First National Bank of Ipswich were regulated by the Office of the Comptroller of the Currency, a federal agency.
Banks may choose to operate under a federal or state charter and, in the wake of the Dodd-Frank Act of 2010, more banks are opting for a state charter.
“Supervision by a state regulator may provide oversight with greater understanding of the local market and the challenges that community banks face,” Massachusetts Commissioner of Banks David Cotney said in a statement.
The Massachusetts Division of Banks approved Brookline Bank’s application for conversion after considering the effects of the proposed transaction and determining that all of the relevant statutory and regulatory requirements were met.
“We do not expect that Brookline Bank’s conversion to a state charter will result in any significant change in the bank’s operation or the products and services offered,” Cotney said.
Concurrent with this conversion, Brookline Bank was also approved to become a member of the Federal Reserve System.
Simultaneously with the Brookline Bank transaction, The First National Bank of Ipswich, with assets of approximately $272 million and six banking offices in Essex and Suffolk counties, was approved by the Massachusetts Board of Bank Incorporation to convert from a national bank to a Massachusetts-chartered trust company.
The First National Bank of Ipswich also received approval to remain a member of the Federal Reserve System and changed its name to First Ipswich Bank.
The Massachusetts Division of Banks oversees approximately 220 banks and credit unions with more than $320 billion in total assets.