The federal Office of Thrift Supervision has given 2 insurers permission to buy federal savings banks and become federally regulated bank holding companies.
The insurers, Hartford Financial Services Group Inc., Hartford, and Lincoln National Corp., Radnor, Pa., say they are making the deals in an effort to become eligible to participate in the federal Capital Purchase Program, part of the Troubled Asset Relief Program.
Hartford is acquiring Federal Trust Bank, Sanford, Fla., a savings bank, and the bank’s parent, Federal Trust Company.
Hartford has offered to “inject a significant amount of capital” into the bank to re-capitalize the bank, according to the OTS.
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OTS has issued an order approving Hartford’s application with some conditions.
Hartford, for example, must consummate the deal within 30 days and must ensure that 40% of the savings bank’s directors are independent from Hartford.
Lincoln has applied for permission to acquire Newtown County Loan & Saving FSB, Goodland, Ind., a federally chartered mutual savings bank.