The Provident Bank to Go Fully Public With Second-Step Conversion

A Massachusetts bank with a strong presence in southeastern New Hampshire is going fully public.

Amesbury, Massachusetts-based The Provident Bank is proceeding with a second-step conversion. The bank has offices in Bedford, Exeter, Portsmouth and Seabrook.

The mutual holding company of the bank said in a regulatory filing submitted yesterday that its board of directors has adopted a plan to issue new shares of common stock and reorganize into a new fully public stock holding company structure.

The bank did not disclose how many shares it would be issuing, but said in the regulatory filing that the new shares would be initially priced at $10 each. Shares of Provident Bancorp were trading at $23.40 as of this morning.

Provident’s President and CEO Dave Mansfield could not be immediately reached for comment.

The purpose of the offering, according to the regulatory filing, is to enhance the bank’s regulatory capital position, improve liquidity of the existing shares of common stock, facilitate the company’s ability to pay dividends to its shareholders and facilitate future mergers and acquisitions.

The news comes more than four years after Provident issued a partial IPO in 2015 when it offered 4.2 million shares of common stock for sale at $10 per share, representing 45 percent of its outstanding shares of common stock.

Since that time, the bank has grown from about $663 million in assets to close to $1 billion and managed to grow its return on assets to 0.9 percent. In recent years, Provident Bank has also shifted its business model to focus more on international small business lending, and as a result, has grown its commercial and industrial loan portfolio.

As part of the conversion, the bank will become a wholly owned subsidiary of a new holding company, which will also be named Provident Bancorp.

Shares of common stock of the company held by people other than the mutual holding company will be converted into shares of common stock of the new holding company pursuant to an exchange ratio generally intended to preserve the percentage ownership interests of such people.

Depositors of the bank with qualifying deposits as of May 31, 2018, will have first priority to purchase the new shares of common stock.

The plan of conversion is subject to approval by the company’s stockholders, the board of governors of the Federal Reserve System and the Massachusetts Commissioner of Banks.