Five Star service: Bath National Bank consolidation to take effect Monday

The name it is a changing for Bath National Bank.

After the bank closes Friday evening it will change over to Five Star Bank. Matthew Murtha, senior vice president with parent community bank holding company Financial Institutions Inc., said the change technically will occur Monday, but customers banking Saturday morning will notice. For customers, Murtha said the change will primarily be cosmetic.

“Basically it's the same people and all that,” he said. “From our perspective, it's really just a name change. We'll be converting the branches over right while they're there.

“We've been pretty busy,” Murtha added. “It's always a track meet, but we're pretty excited.”

The change, which combines FII subsidiaries Bath National Bank, Olean-based First Tier Bank & Trust, National Bank of Geneva and Wyoming County Bank of Warsaw, has been approved by both the state Banking Department and the Board of Governors of the Federal Reserve System.

For FII, Murtha said the consolidation will mean better branding power and communication of services to clients. In all, Five Star Bank will have 50 branches and 72 automated teller machines. Customers from all four banks, however, could already take advantage of utilizing those ATMs without a service charge.

The subsidiaries also previously shared centralized functions, including human resources, training, credit administration, post-closing loan operations, deposit operations and compliance.

To make the transition as easy as possible, account numbers, ATM cards and check stationary will not change. Staffing levels are expected to remain the same, as well as the products and people customers deal with. Douglas L. McCabe, president of Bath National Bank, will become a regional executive for the area its branches serve.

Day-to-day operations also will be more efficient, Murtha said, adding program implementation also should improve.

The merger also was done through the First Tier subsidiary, allowing FII to streamline operations by reducing the number of regulatory bodies the company reports to. In August, Peter Humphrey, FII's chairman, president and chief executive officer, also said the merger will improve the company's credit quality, ensure consistency in lending practices and help it gain a greater market share in the 10,000 square-mile region it will serve.

“The name Five Star Bank incorporates our legacy and history, and exemplifies the high level of service our communities and customers have come to expect,” Humphrey said in a news release issued Wednesday. “Five star also represents who we are - a solid, reliable bank staffed with quality, caring people that are actively engaged with our local communities.”

Over time, Humphrey said overhead expenses will be reduced by more than $3 million.

The banks' boards, as well as FII's, approved the merger in August, and the company was shooting for fourth-quarter implementation. According to Murtha, the merger is occurring right on time. The weekend of Dec. 3 and 4 had always been the target date, he said.

“We remain committed to the communities we serve,” he added, “even more so now.”

Bath is FII's newest holding, having been added in May 2001. Founded in 1912, Bath National Bank operates 13 full-service banking offices throughout Chemung, Steuben, Ontario and Yates counties. It's assets are placed at $420 million.

FII was formed in 1931 to facilitate the management of three banks primarily owned and operated by the Humphrey family since the late 1800s. FII has $2.1 billion in assets through its banking and investment brokerage subsidiaries.

Shares of FII, which are traded on NASDAQ under the symbol FISI, fell 12 cents or 0.59 percent Wednesday to $20.19.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.