Coastway selling to HarborOne Bank
Bill White remembered instantly. He had written a loan to Robert Taylor in 1982 from Warwick Credit Union (later Ocean State Credit Union) with a single branch at the corner of Warwick and Church Avenues. White grew up on Church Avenue not far from the bank, now Coastway Community Bank, that he is president of.
Taylor’s company still does business with the bank. Robert’s son, Ryan, was one of about 50 of the bank’s clients to attend a breakfast Thursday at the Crowne Plaza. The event was planned for Wednesday, but with Tuesday’s storm was postponed. White had planned for the group to be among the first to learn that Coastway was being sold to HarborOne Bank, a Massachusetts-based bank with roots in Brockton.
By Thursday morning, news of the sale was out. The night before, also at the Crowne, White called together the bank’s 148 employees to inform them that little would change other than the bank’s name. All nine Community branches and three mortgage offices are to remain open and White and other key personnel will continue to work from Community’s corporate offices, which the bank built off Metro Park Boulevard.
White brought the same message to his breakfast guests.
“I’m pleased to stay on; this is my group,” White said.
With $739 million in assets and $477 million in deposits as of Dec. 31, 2017, White said Coastway had reached a size where it needed more resources if it was going to provide new technologies. He said HarborOne was a good fit, close yet without any competing branches and as a single bank “could fill in the blanks between them.”
According to a release, the combined company will be the 12th largest publicly-traded New England community bank based on total assets of $3.4 billion, with 65 locations serving individuals and business across Massachusetts, Rhode Island, New Hampshire and Maine. The combined company will be positioned to be a major mortgage lender in New England and the number one mortgage lender in Rhode Island.
According to James Blake, president and chief executive officer of HarborOne Bancorp, who was reached for a telephone interview Friday, HarborOne was looking to expand and was interested in Rhode Island after writing more than $300 million in loans from its Providence loans products office in 2016. Also, he said the Rhode Island banking market is less competitive than Massachusetts and, at 27 miles from Brockton, the state is closer to its core operation than Hyannis on the Cape or Worcester, which apparently had been considered for expansion.
“Coastway is a good-sized bank,” he said.
He remarked on Coastway’s involvement in the community including 4,300 hours of volunteerism. He called Coastway’s CRA (Community Reinvestment Act) rating “outstanding,” noting that the bank is the state’s “number one affordable housing lender.” Blake also noted that Coastway is “very strong in the SBA” and that HarborOne would be looking to increase its work with the Small Business Administration.
Asked about staffing and whether the acquisition would mean the loss of jobs, Blake said there would be some economies to be gained through the combination of operations but no decisions have been reached at this point.
“There will be all the same people in the branches,” he said.
“He going to be responsible for growing our [Rhode Island] operations,” Blake said of White.
Blake does not see additional banks in Rhode Island in the immediate future, although he did not rule that out.
Under the HarborOne banner – HarborOne purchase of Coastway still requires stockholder approval of both institutions as well as regulatory approvals – the Coastway name will be replaced by HarborOne. White expects the sale to be finalized in the second half of the year and the name change shortly thereafter. He foresees no issue with stockholder approval as Coastway stock when it became publicly traded in four years ago was issued at $10 a share. Harbor One is paying $28.25 a share for Coastway shares in an all cash transactions valued at approximately $125.6 million.
An aspect of the bank that won’t change? White told Taylor and others at the table that he will serve on the Coastway charitable foundation and that foundation gifting will be targeted to Rhode Island non-profits. In addition to being a significant contributor, Coastway provides office space to Mentor Rhode Island at its Warwick and Church Avenue location. Among other non-profits the bank foundation supports is the Rhode Island Academic Decathlon. White serves as chair of the decathlon foundation, the fund-raising arm of the decathlon.
With acquisition of Coastway, might HarborOne become a candidate for acquisition by yet an even bigger bank?
Blake said HarborOne has no intent or desire to be bought.
“We will not [be bought out],” he said. And just to be clear, he repeated, “We will not.”
Coastway Bancorp, Inc. is the holding company for Coastway Community Bank, originally founded in 1920 as the Telephone Workers Credit Union, which later changed its name to Coastway Credit Union and converted to Coastway Community Bank in 2009. It became a publicly traded company listed on NASDAQ in 2014.
HarborOne Bancorp, Inc. is the holding company for HarborOne Bank, the largest co-operative bank in New England. HarborOne Bank serves the financial needs of consumers, businesses and municipalities throughout Southeastern Massachusetts through a network of 14 full-service branches, two limited service branches, a commercial loan office in Providence, Rhode Island, a residential lending office in Westford, Mass. and 13 free-standing ATMs.