July 24, 2014 | Updated 12:00am

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Thursday, July 17, 2014, 12:02pm

Cape Ann, Granite Savings Banks To Merge

Cape Ann Savings Bank in Gloucester will acquire Rockport-based Granite Savings Bank in a deal expected to close in the fourth quarter.

According to a statement from Cape Ann Savings Bank, Norman S. Seppala, president and CEO of Granite Savings Bank, approached Harold J. Rogers, II, president and CEO of Cape Ann Savings, last fall to talk about his bank's interest in merging with Cape Ann Savings.

"When Mr. Seppala approached us in September of last year about Granite's interest in a proposed consolidation with us, it made a lot of sense, as we would be able to both better serve our existing Rockport customer base and also attract new customers with our expanded product offerings such as commercial lending services, mobile banking, and trust and financial services," Rogers said in the statement.

Seppala, also in the statement, said, "With this merger, our customers will be able to access an expanded line of deposit, lending, trust and wealth management services that we have been unable to offer because of our size. Small community banks are continually challenged to keep pace with technology expenditures, flat revenue growth and increasing operating costs."

Presently, Cape Ann Savings Bank has assets of $472 million, two offices and 61 full-time employees, while Granite Savings Bank has $70 million in assets, one office and 13 employees.

Upon completion of the merger Granite Savings Bank's office will become a full-service branch of Cape Ann Savings Bank. All Granite employees will become employees of Cape Ann.  In addition, corporators of Granite will become corporators of Cape Ann and four Granite trustees will become trustees of Cape Ann. 

The consolidation transaction requires approval of at least two-thirds of the corporators of both Granite and Cape Ann as well as the customary regulatory approvals. Kirkpatrick and Lockhart and J. Michael Faherty served as legal counsel for Cape Ann and Nutter, McClennen & Fish LLP served as legal counsel to Granite.

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