EXHIBIT 99.1
FOR IMMEDIATE RELEASE
SIS Bancorp, Inc. Announces Entry into Connecticut
Springfield, MA - August 18, 1997; 8:30 a.m., The Boards of Directors of SIS
Bancorp, Inc. ("SIS"), (NASDAQ: SISB), and Glastonbury Bank & Trust Company
("GBT"), (NASDAQ: GLBT), announced today that they have signed a definitive
merger agreement under which SIS will acquire all of the outstanding shares of
GBT. As a result of the transaction, GBT will become a wholly owned subsidiary
of SIS.
The transaction is structured as a tax-free exchange of 0.74 shares of SIS
common stock for each of GBT's 1,829,920 shares of common stock. Based on the
per share closing price for SIS common stock on August 15, 1997 of $30.00, the
transaction would be valued at $40.6 million and GBT shareholders would receive
$22.20 in SIS common stock for each share of GBT common stock. At a purchase
price of $22.20 per share, the exchange is approximately equivalent to 2.26x
GBT's June 30, 1997 book value and approximately 16.3x GBT's annualized earnings
per share for the six months ended June 30, 1997. GBT has the right to terminate
the agreement if SIS' average stock price for the twenty consecutive trading
days ending on the fifth business day prior to the closing date of the
acquisition is below $25.00, unless SIS agrees at such time to increase the per
share exchange ratio to ensure a per share value of $18.50 in SIS common stock
to GBT stockholders. In connection with the execution of the definitive
agreement, GBT has granted SIS an option to purchase, under certain
circumstances, approximately 8.5% of its authorized common stock. In the event
that such option becomes exercisable, GBT will be further obligated to pay an
additional cash payment to SIS of $1.5 million.
The transaction, which will be accounted for as a pooling of interests, is
subject to approval by SIS and GBT shareholders and various regulatory agencies.
It is anticipated that the transaction will close by year end 1997. After
consummation of the transaction, GBT will remain a Connecticut chartered
commercial bank led by J. Gilbert Soucie, GBT's current president and chief
executive officer. It is also expected that Mr. Soucie will serve as vice
chairman of SIS. The Board of Directors of GBT will be retained to provide
continuing leadership and guidance to the GBT organization. In addition, SIS
will increase the size of its Board of Directors to add one of GBT's directors
to serve as a director of SIS after the merger is consummated.
In announcing the transaction, F. William Marshall, Jr., SIS' president and
chief executive officer stated, "A partnership with Glastonbury Bank and Trust
demonstrates SIS' philosophy towards the importance of community banking.
Expansion into Connecticut has been one of our strategic objectives and is
consistent with our ongoing efforts to increase earnings and deliver a superior
return to our shareholders. Central Connecticut is a very attractive consumer
and commercial banking market and is a natural, contiguous extension to SIS'
existing banking franchise. GBT provides a very solid base from which we can
together grow in this attractive market. Additionally, GBT's merchant processing
and insurance businesses will further expand and diversify the services we can
offer in the future."
SIS expects to take a pre-tax charge of $2.5 million in 1997 to cover merger
related expenses, and expects the merger to have a positive impact on earnings
per share in 1998 and beyond.
J. Gilbert Soucie, president and chief executive officer of Glastonbury Bank &
Trust, stated, "We are very pleased about the pending affiliation with SIS, an
institution which shares our commitment to community banking. A partnership with
SIS will bring new technology, more products and services, and increased capital
to enhance GBT's abilities to serve its growing customer base. More importantly,
GBT will be able to maintain the same strong level of personal service and
community focus."
In connection with the execution of the merger agreement, the SIS Board of
Directors has rescinded its existing authorization to repurchase up to 286,180
shares of SIS common stock. During 1997, SIS repurchased 146,400 shares, net of
shares reissued under SIS's various benefit plans.
SIS Bancorp, Inc., headquartered in Springfield, MA, is the parent holding
company of Springfield Institution for Savings ("SlS Bank"), a state chartered
savings bank. SIS Bank, originally founded in 1827, operates 24 branch banking
offices in Agawam, Amherst, Chicopee, East Longmeadow, Holyoke, Longmeadow,
Ludlow, Northampton, South Hadley, Springfield, West Springfield and Westfield,
MA. At June 30, 1997 SIS had total assets of $1.4 billion, total deposits of
$1.0 billion, and total equity of $103.3 million.
Glastonbury Bank & Trust Company is a Connecticut-state-chartered commercial
bank organized in 1919 and headquartered in Glastonbury, CT. GBT operates 8
branch banking offices in the Connecticut communities of Glastonbury,
Colchester, East Hartford, Portland, Rocky Hill and Wethersfield. At June 30,
1997, Glastonbury had total assets of $261.3 million, total deposits of $216.6
million, and total equity of $18.0 million.
GBT investor inquiries are to be directed to J. Gilbert Soucie at (860)
652-6500. SIS investor inquiries are to be directed to Ms. Ting Chang at
(413)748-8271. All media inquiries are to be directed to Ms. Kathleen Bourque at
(413)748-8243.
This news release contains certain forward looking statements regarding enhanced
revenues that may be realized from the transaction. SIS cautions readers that
such forward looking statements involve certain risks and uncertainties,
including a variety of factors that may cause SIS' actual results to differ
materially from the anticipated results or other expectations expressed in any
forward looking statements made by, or on behalf of SIS. These factors are
further detailed in SIS' current report on Form 8-K dated August 18, 1997, which
has been filed with the Securities and Exchange Commission.
Summary Information:
Acquisition Information
Exchange Ratio 0.74
Glastonbury Shares Outstanding 1,829,920
New SIS Shares Issued 1,354,141
Valuation Based on Closing Price on August 15, 1997 of $30.00:
Aggregate Purchase Price $40.6 million
Price Per Share $22.20
Price/Annualized Earnings Per Share
for the six months ended June 30, 1997 16.3x.
Price/June 30,1997 Book Value 2.26x.
Core Deposit Premium 11%
Accounting Treatment Pooling.
Expected Closing Date Year end 1997.
Statistics at June 30, 1997 ($ Millions) SISB GLBT
- ---------------------------------------- ---- ----
Headquarters Springfield, MA Glastonbury, CT
Branches 24 8
Assets $1,434.5 $261.3
Net Loans $ 645.9 $152.9
Deposits $1,015.4 $216.6
Equity $ 103.3 $ 18.0
Equity/Assets 7.2% 6.9%
Non-Performing Assets/Total Assets 0.47% 1.04%
Loan Loss Reserves/Non-Performing Loans 272% 197%
Net Income for Six Months Ended June 30, 1997 $ 5.8 $ 1.2
FTE Employees 483 123