SalemNews.com, Salem, MA

Local News

May 24, 2011

Bank to cut 91 jobs in merger

DANVERS — The Connecticut bank that is acquiring Danversbank plans to lay off 91 employees, nearly one-quarter of the local bank's workforce, once the merger is complete.

The layoffs will take place from Aug. 1 to Oct. 28 and will affect employees at five locations in Danvers and one in Beverly, according to a letter Danversbank filed with the state last week.

People's United Bank, which is acquiring Danversbank for $493 million, plans to lay off loan associates, operations analysts, security desk attendants, parking lot attendants, couriers, clerks, customer representatives, and the in-house cleaner at Danversbank headquarters in Danvers Square, among other positions.

The layoffs will come at the same time that Danversbank executives and directors are scheduled to receive more than $19 million in stock options that will be accelerated due to the merger.

Danversbank CEO Kevin Bottomley said the number of layoffs is not out of line with those that have occurred in other bank mergers.

"It's a large transaction," Bottomley said. "We were a pretty good-sized bank, so in percentage terms I don't think it's necessarily different from transactions of a similar size. We had a large back-office operation, so therefore particularly when the acquirer is not within the market, or even if it is within the market, you just simply have duplicative positions in non-customer-facing positions."

Bottomley is in line to receive more than $17 million in stock options and other payments in the merger. He will remain as a consultant for People's United for $400,000 over two years.

The planned layoffs are detailed in a letter to the Massachusetts Division of Career Services. Employers are required to notify the state of any large layoffs so that its "rapid response teams" will be prepared to assist the laid-off workers.

"I've called over to the bank to offer help," said Mary Sarris, executive director of the North Shore Workforce Investment Board, which provides worker assistance. "I'm sure it's a very stressful time."

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