HOLLAND — Chemical Financial Corp’s. acquisition of branches that Old Kent and Fifth Third had to jettison as a result of their merger gives the Midland-based corporation a solid foothold in a market it’s been wanting to tap.
Chemical Financial is acquiring three branches in Ottawa County, and a fourth in Fremont, from Old Kent and Fifth Third, which were forced to divest of the offices by federal regulators.
The acquisition of the branch offices comes three months after Chemical Financial completed its acquisition of Benton Harbor-based Shoreline Financial Corp., which has banking offices as far north as Fennville and Saugatuck in Allegan County.
Chemical Financial, which until the Shoreline merger had been centered in central and eastern Michigan, wanted to move further up the Lake Michigan shoreline and enter the growing Holland-Zeeland and Grand Haven markets. The corporation saw the Old Kent and Fifth Third divestitures as a perfect opportunity to grow, President and Chief Executive Officer Aloysius Oliver said.
The offices in Holland, Zeeland and Grand Haven will become part of the corporation’s new Chemical Bank West subsidiary, Oliver said.
“It’s a natural extension of their market,” he said. “Generally the west side of the state has markets growing a little faster than the east side of the state. As those markets become saturated, you have to look for new markets, and these are new markets and good markets for us.”
Founded in 1917 as Chemical Bank & Trust in Midland, Chemical Financial today has assets of $3.1 billion and will grow to 122 branch locations when acquisition of the Old Kent and Fifth Third offices is complete this summer. Terms of the deal were not disclosed.
Once the acquisition is complete, retail and commercial deposits and loans handled out of the Fifth Third and Old Kent branches involved in the deal will transfer to Chemical Bank. The branches, which have combined deposits of $150 million, include:
- The Old Kent office at 501 W. Main St. in Zeeland.
- The Old Kent office at 91 Douglas Ave. in Holland Township.
- The Fifth Third office, formerly an AmeriBank branch, at 1600 Beacon Blvd. in Grand Haven.
- A Fifth Third office in Fremont.
Oliver describes Chemical bank as being “firmly committed” to community banking and catering primarily to small businesses and retail customers. While considerably larger than most community-banking competitors, such as Macatawa Bank and Byron Center State Bank, Chemical Bank is small enough where it can operate as a small-town bank, he said.
The bank is in a position where it can offer “hands-on service for the customer, but part of a larger group that can do things that larger institutions do,” Oliver said.
The branches were sold after federal regulators decided that Ohio-based Fifth Third’s acquisition of Old Kent would give the company a monopoly in those markets.
Federal regulators also decided that Old Kent and Fifth Third would have to sell the offices to a competitor that did not presently serve the existing markets, Old Kent spokeswoman Peggy Janei said.
“It had to be a new player. It could not be somebody that was here,” Janei said.
The banks sent information packages to potentially interested parties and Chemical Financial submitted the best offer, Janei said. Offers were judged based on which potential buyer could take over the branches with as little inconvenience as possible to customers, she said.
“A lot of it was ‘who is going to maintain customer service and have a similar product package,’” Janei said.