Orders issued under Bank Merger Act - Legal Developments

Federal Reserve Bulletin, Feb, 2002

As noted, Bank has proposed divestitures in the remaining three banking markets affected by the proposal: Highlands County, North Lake-Sumter Area, and Polk County, all in Florida. (10) After accounting for the proposed divestitures, consummation of the merger would be consistent with the DOJ Guidelines in each of these banking markets. There are numerous competitors in each market, several with market share of at least 5 percent.

The Department of Justice also has conducted a detailed review of the anticipated competitive effects of the proposal. The Department has advised the Board that, in light of the proposed divestitures, consummation of the proposal is not likely to have a significantly adverse effect on competition in any relevant banking market. The Office of the Comptroller of the Currency ("OCC") and the Federal Deposit Insurance Corporation ("FDIC") have been afforded an opportunity to comment and have not objected to consummation of the proposal.

The Board has reviewed carefully all the facts of record, including the public comment on the competitive effects of the proposal, and for the reasons discussed in this order has concluded that consummation of the proposal is not likely to affect competition or the concentration of resources in a significantly adverse manner in any of the twelve banking markets in which Bank and Huntington directly compete in Florida or in any other relevant banking market. Accordingly, based on all the facts of record and subject to completion of the proposed divestitures, the Board has determined that competitive factors are consistent with approval of the proposal.

Financial, Managerial, and Other Supervisory Factors

In reviewing this proposal under the Bank Merger Act and section 9 of the FRA, the Board has considered the financial and managerial resources and future prospects of the institutions involved. The Board has reviewed these factors in light of all the facts of record, including supervisory reports of examination assessing the financial and managerial resources of Bank, and information provided by Bank. (17) The Board notes that Bank would remain well capitalized on consummation of the proposal. Based on all the facts of record, the Board concludes that the financial and managerial resources and future prospects of the institutions involved and other supervisory factors are consistent with approval of the proposal.

Convenience and Needs Considerations

The Bank Merger Act also requires the Board to consider the convenience and needs of the communities to be served and to take into account the records of the relevant depository institutions under the Community Reinvestment Act ("CRA"). (18) The CRA requires the federal financial supervisory agencies to encourage financial institutions to help meet the credit needs of the local communities in which they operate, consistent with safe and sound operation, and requires the appropriate federal financial supervisory agency to take into account an institution's record of meeting the credit needs of its entire community, including low- and moderate-income ("LMI") neighborhoods, in evaluating bank acquisition proposals.