New York’s oldest savings bank, Emigrant Savings Bank, might be selling off their 33 branches to a buyer from — where else? — New Jersey. Investors Bancorp, based in Short Hills, N.J., expressed interest in purchasing the 160-year-old bank’s branches, following Emigrant’s announcement earlier this month that they were considering selling off their network, likely in an effort to raise much-needed capital.
The bank has fallen on harder times in the wake of the financial crisis, and news broke earlier this month that it had hired Barclays Capital to “explore selling its 33 branches or online banking operation,” reported American Banker. Its online operation, Emigrant Direct, was founded in 2005, and expanded the New York bank’s reach.
Emigrant borrowed $267 million in TARP funds from the Treasury Department (technically the money was lent to New York Private Bank & Trust Corp, its parent company), in 2008. It has yet to pay back a penny. Though the bank did not state so publicly, or make any statements regarding the possible sale of assets publicly, it would appear that these two issues are related.
Investors Bancorp’s interest in the branch network broke earlier this week, by SNL Financial. Investors Bancorp CEO Kevin Cummings told SNL that he would consider buying Emigrant’s branch network in New York. But only “if it’s appropriate pricing.” Cummings primary concern is that Emigrant would expect inflated 2006 prices for their real estate.
Investors Bancorp refused to comment further on the matter. Emigrant Bank could not be reached for comment.
A bank for the Irish
If Emigrant opts to sell its branches, and not its online banking unit, it will strip New York City of a bit of colorful history. The bank was founded in 1850 by the Irish Emigrant Society, and served New York’s rapidly expanding community of Irish immigrants in the late 19th century. It grew to be the largest savings bank in the U.S. by the 1920’s. The bank was so popular among Irish immigrants that its record books serve as a useful tool for Irish-Americans studying family genealogy — security questions and information associated with remittances offer more useful data about relatives than Ellis Island or other governmental sources. The bank has been controlled by the Milstein family, a major player in New York real estate, since 1986.
Investors Bancorp was founded in 1926 and has over 80 branches in New Jersey and New York. By purchasing Emigrant’s network, it would expand its reach in New York considerably.