New Haven Calls For Public Hearing On Bank Merger

The city of New Haven is calling for a public hearing on the merger of its largest bank, which will be taken over by a New York-based institution. WNPR’s Harriet Jones reports.

New Alliance, the former New Haven Savings Bank announced earlier this year that it would merge with First Niagara Financial, based in Buffalo New York. That out-of-state control is the end that many predicted, when the bank converted from being a mutual institution to a shareholder owned bank in 2003.

But New Haven Mayor John DeStefano says the community should still have a say. He’s joined with Attorney General Richard Blumenthal in calling for state and federal regulators to hold a public hearing on the merger in New Haven. Blumenthal says he wants answers on the bank’s handling of foreclosures, its community reinvestment record and its lending plans in Connecticut. DeStefano accused the bank’s executives of enriching themselves at New Haven’s expense, and said First Niagara does not have a good record in community lending. He also predicted massive job losses if the merger goes through – the banks have said there will be some reductions, but that they won’t affect customer contact.

For WNPR, I'm Harriet Jones.