Glastonbury lender United Financial Bancorp Inc. wants to invest about $35 million to repurchase 5 percent of its common stock.
The parent of $5 billion-asset United Bank, created in the April 30 merger of former Rockville Bank and former United Bank of West Springfield, said Wednesday its board of directors approved a third stock repurchase for up to 2,566,283 shares.
The program has been blessed by United’s principal regulator, the Federal Reserve Bank of Boston, and is eligible to start immediately.
As of early afternoon Wednesday, United’s shares traded at $13.46, down 2 cents, valuing its pledged buyback stake at $34.6 million.
A United spokesman said operating profits, plus the remaining capital from its conversion from a mutual bank to a stock bank a few years back, are being earmarked to take advantage of what the bank’s leadership sees as the market undervaluing United’s stock.
“Capital efficiency is a key driver of valuation, therefore management will strive to become capital efficient using all available tools in a prudent manner,” United Financial and United Bank CEO William H. W. “Bill” Crawford IV said in a statement.
Crawford said repurchases may be made from time to time in open-market or negotiated transactions as deemed appropriate by the bank and will depend on market conditions.
