Willimantic’s SI Financial Group, parent of Savings Institute Bank and Trust Co., said it has filed a notice with regulators to convert from a federal charter to a state charter.
CEO Rheo A. Brouillard said in a statement that the bank’s business plan and directors remain unchanged, but that federal financial reform legislation known as Dodd-Frank has removed most of the benefits of operating under a federal savings bank, or thrift, charter.
Brouillard said there are “significant advantages to operating as a community bank with a local regulator that understands and lives in our market areas in Connecticut and Rhode Island.”
Dodd-Frank placed federally chartered thrifts under the supervision of the Office of the Comptroller of the Currency, rather than the Office of Thrift Supervision, according to a 2011 analysis by PricewaterhouseCoopers, which said that banks were concerned about increased scrutiny of commercial loan portfolios and loan loss reserves.
If it receives approvals, SI would remain a savings and loan holding company regulated by the Federal Reserve and insured by the Federal Deposit Insurance Corp.
Savings Institute has nearly 30 branches in Connecticut and Rhode Island, six of which are in the Greater Hartford area.
