Rockland Trust parent to accept TARP funds

ROCKLAND, Mass. – Independent Bank Corp. (Nasdaq: INDB), parent of Rockland Trust Co., has received preliminary approval for a federal investment of about $78 million under the U.S. Treasury Department’s Capital Purchase Program.
The program allows the Treasury to buy shares in healthy banks in hopes the boost in capital will encourage them to expand lending. It is part of the $700 billion Troubled Assets Relief Program (TARP) established by the U.S. Emergency Economic Stabilization Act of 2008 (EESA) enacted in October.
“We are pleased to announce our voluntary participation in the Capital Purchase Program, and the Treasury’s preliminary approval of our application,” said Christopher Oddleifson, president and CEO of both Rockland Trust and its parent company. “The fact that the U.S. Treasury is willing to invest in Independent Bank Corp. is a testament to our strength and stability and confirms our good standing and healthy financial status.”
Independent this fall posted a third-quarter profit of $8.81 million on total revenue of $53.80 million. (READ MORE) Last month, it announced plans to acquire Franklin, Mass.-based Benjamin Franklin Bancorp. Inc. (Nasdaq: BFBC) in a stock swap valued at $125 million that is expected to close in the 2009 second quarter. (READ MORE)
As of Sept. 30, the Rockland-based bank exceeded federal regulatory standards for the “well-capitalized” label, posting a Tier 1 capital leveraging ratio of 7.69 percent, total risk-based capital ratio of 12.06 percent and tangible equity-to-tangible assets ratio of 5.32 percent.
Under the new-capital plan whose preliminary approval the company announced last night, the Treasury would purchase about $78 million in new, non-voting senior preferred shares in Independent, and also would receive warrants to purchase INDB common stock under standard Capital Purchase Program terms and conditions. The transaction “is subject to the completion of required documentation, which Independent Bank Corp. anticipates will occur in January 2009,” the bank said.
Treasury officials and banking regulators have been urging financial institutions to take part in the program to help the nation’s economy, Independent noted. Local banks that have applied for such investments include Providence-based Bancorp Rhode Island (Nasdaq: BARI), parent of Bank Rhode Island, which would qualify to receive up to $30 million in federal investments; and Waterbury, Conn.-based Webster Financial Corp. (NYSE: WBS), parent of Webster Bank N.A., which could receive up to $460 million in fresh capital under the program. (READ MORE)
Independent Bank Corp. (Nasdaq: INDB) is the parent of Rockland Trust Co., a full-service community bank with assets of $3.5 billion that serves southeastern Massachusetts, Cape Cod and Rhode Island. Additional information is available at www.RocklandTrust.com.
Information about the U.S. Treasury Department’s Capital Purchase Program, part of the $700 billion Troubled Assets Relief Program (TARP), is available at www.treas.gov. Additional information about federal financial rescue efforts is available at a new multiagency site called EconomicRecovery.gov.