500 River Ridge Drive, Suite 300
Norwood, Massachusetts 02062-5064
Telephone: (617) 361-6900
Fax: (617) 361-2662
Web site: https://www.bluehillsbank.com
Founded: 1871 as Hyde Park Savings Bank
Total Assets: $2.67 billion (2017)
Stock Exchanges: Nasdaq
Ticker Symbol: BHBK
NAICS: 551111 Offices of Bank Holding Companies
Blue Hills Bancorp, Inc., based in Norwood, Massachusetts, is the holding company of Blue Hills Bank, a Massachusetts-chartered savings bank primarily serving neighborhoods in the southernmost part of Boston. The bank maintains 11 full-service branches. Three of those branches, in Nantucket, Massachusetts, operate under the Nantucket Bank name. In addition, Blue Hills operates loan production and mortgage offices in Boston, Cambridge, Concord, Dorchester, Franklin, Hingham, Lowell, Marblehead, Plymouth, and Winchester, Massachusetts.
Positioned as a community bank, Blue Hills provides both personal and business banking products and services. For individuals, it offers checking and savings accounts, certificates of deposit, money market accounts, personal loans, mortgages, home equity loans and lines of credit, credit and debit cards, and online and mobile banking. Blue Hills also offers business checking and savings products, credit cards, cash management services, business loans, Small Business Administration loans, asset-based loans, and commercial real estate loans. To help fulfill a community banking mission, the Blue Hills Bank Foundation supports local charities and organizations and funds financial literacy programs. Bank employees are also encouraged to volunteer their time for community work. Blue Hills Bancorp is a public company listed on the Nasdaq.
Boston's Hyde Park neighborhood, located near the 6,000-acre Blue Hills Reservation, began to take shape in the 1840s, and the following decade brought accelerated development. In 1868 the town of Hyde Park was incorporated (and remained independent until being annexed by Boston in 1912). With a growing population came the need for banking services. In the spring of 1871 Hyde Park Savings Bank was organized as a mutual state savings bank. Serving as president was Charles F. Gerry. The treasurer was Henry S. Bunton, the bookkeeper and paymaster of a woolen mill plant owned by Robert Bleakie, one of the town's largest real estate owners. Bunton held the post at the bank for the next 18 years. In 1880 Bleakie became the bank's president and served in that capacity until his death in 1917.
When the stay was lifted in June 1880, deposits had been reduced to about $30,000. With an improving economy, Hyde Park Savings resumed its growth. In 1888 the bank received about $140,000 in deposits, bringing the total amount of deposits to more than $232,000. Prosperity continued through the remainder of the century, but the bank was again the victim of an accident. In 1897 a fire broke out on the second floor of the building, causing an estimated $100 in damages to the bank. The bank was solvent enough that two years later it constructed a two-story building at the corner of River Street and Everett Square. The bank occupied the ground floor and leased the second floor to a pair of doctors.
In the 20th century, Hyde Park Savings continued to operate as a local mutual savings bank, receiving little press attention. In October 1990 the Boston Business Journal's Ada Focer listed it as one of Boston's best small banks, reporting that it held $200 million in assets. Despite the recession at the time, the bank maintained its solid position through diversification. “We pay a lot of attention to portfolio structure, like those Nobel economists suggest,” President Harlan Pinkham told Focer. “We have a broadly diversified portfolio of stocks, bonds and real estate investments. That way we may get hurt in one portion but I'm comfortable that if you're structured properly you never get wiped out.” The bank focused on basic products and services but also offered something of emotional value as well to its customers. “I think they want reassurance—to come in here and look me straight in the eye and ask if their money is safe,” Pinkham explained. “I don't see that changing over time.”
Hyde Park Savings continue to enjoy steady growth, remaining independent at a time of rapid consolidation in the banking sector. According to a government report on the state of banking in Boston, it increased the value of its assets to $486 million in 2002, but its portfolio was no longer balanced. Rather than making local loans through mortgages, it now primarily invested in portfolios backed by real estate. In 2002, 98.1 percent of its portfolio was secured by real estate. Just two year later, the value of assets increased to $811 million, of which 97.1 percent was backed by real estate.
Hyde Park Savings reached a turning point with the financial crisis in the fall of 2008 that had been triggered by the bursting of a housing bubble, caused in large part by subprime mortgages and lax lending standards. A recession quickly followed, leading to the failure of numerous banks and financial institutions, despite a massive government bailout program to relieve firms of so-called toxic assets. Of Hyde Park Savings' $908 million in assets, about $500 million were invested in a securities portfolio that included large investments in troubled mortgage giants Fannie Mae and Freddie Mac as well as investment bank Bear Stearns, which was sold to JPMorgan Chase & Co. following the collapse of its stock.
Hyde Park Savings' business model came under public scrutiny. Unlike other Massachusetts savings institutions with an average loan-to-deposit ratio of 90 percent, the bank lent only about 28 cents for each dollar deposited. As a result, critics called it a mutual fund company disguised as a bank, one that collected local deposits only to send them to Wall Street. Bank CEO Kenneth Pierog insisted that good faith efforts were being made to uphold community loan commitments, but the bank had to contend with stiff competition from much larger banks.
Parent took over a bank that despite its shortcomings was profitable and well capitalized and not saddled with troubled loans. Nevertheless, he wanted to make some significant changes. He told Tim McLaughlin in the Boston Business Journal in June 2010, “We want to migrate from an investment-oriented balance sheet to a more diversified community bank.” Moreover, Parent wanted the bank to do more to build the local economy, a role it had not filled much in recent years. To help jump-start a reengagement with the local community, the bank established a foundation to support local charities and organizations. It would provide ongoing funding equal to 5 percent of the bank's pretax annual profits.
After making grants of $32,000 in the first year, the foundation increased the total to about $500,000 a year later. Parent also encouraged employees to become involved in community activities, launching a program that allowed employees to volunteer on company time and be paid. He also set an example, serving on the board of directors for the YMCA of Greater Boston, Thayer Academy, and Wediko Children's Services, and was part of a nonprofit organization dedicated to rebuilding area Catholic schools. Additionally, he was a member of the bank's Pan-Mass Challenge bike team that raised money for cancer research at the Dana-Farber Cancer Institute.
The bank launched a commercial lending division in early 2011. With the bank's new business strategy came a change in branding. In September 2011 Hyde Park Savings Bank was renamed Blue Hills Bank. “In many ways, our name has been a misnomer,” Parent explained to Banker & Tradesman in a September 23, 2011, article. “Yes, we proudly serve Hyde Park, but we meet the banking needs of several communities, stretching across the Blue Hills from Boston to Brookline to Dedham and on to Norwood. We wanted a name that reflected all of our market today, as well as areas we intend to grow in the future.” About a year later after its establishment, the division received $18.7 million from the U.S. Treasury's Small Business Lending Fund.
Earlier in 2011, a new bank branch opened on Truman Parkway, and the River Street branch in Hyde Park was remodeled. Branches in Norwood and Dedham completed their changes in October 2011 and the following month work began on the West Roxbury branch. In addition to this $6 million investment, Parent expanded his team of senior executives, as well as the rank and file. The workforce expanded from 84 when Parent took charge to 140 when the Blue Hills Bank name was adopted. Moreover, assets grew to $1.1 billion and residential and commercial lending increased significantly. The investment management business, in the meantime, was contracted to outside firms, with the intent of reducing it over the next several years.
Blue Hills expanded through external means in 2013, reaching an agreement to acquire the three-branch Nantucket Bank division from Sovereign Bank. The 175-year-old Nantucket Bank had been acquired by Sovereign in 2004, but it was never fully integrated. With Sovereign's acquisition by Banco Santander in 2009, the decision was made to divest Nantucket in the best interest of all parties, including the local community. As a result, Blue Hills added $265 million in deposits and about $100 million in commercial and consumer loans. Because of Nantucket Bank's strong brand equity, the three branches continued to operate under the Nantucket name.
In January 2014 the Nantucket acquisition was completed and Blue Hills also secured the 10-year naming rights to an outdoor amphitheater. Originally known as the Harbor Lights Pavilion in 1994, it now became the Blue Hills Bank Pavilion. In February 2014 Blue Hills Bancorp was incorporated. The holding company not only served as parent company for Blue Hills Bank and Nantucket Bank, it also facilitated the conversion from a mutual form of ownership to a stock company. In addition, the foundation received $57,000 in cash and nearly 695,000 shares of stock, worth about $7 million. Blue Hills Bancorp conducted an initial public offering of stock in July 2014, raising gross proceeds of about $277.7 million.
In the fall of 2014 Blue Hills opened a new branch in Milton. The following year brought a new branch at Westwood's University Station. In 2016 the bank opened its first branch in downtown Boston, located in the Seaport district near the Blue Hills Bank Pavilion. When 2017 came to a close, Blue Hills reported assets approaching $2.7 billion. It had made significant progress in diversifying its balance sheet and becoming a more integrated part of its community, efforts likely to continue in the years ahead.
Blue Hills Bank; Blue Hills Funding Corporation.
Cambridge Savings Bank; Radius Bank; TD Bank, N.A.
Alix, Laura. “Blue Hills Bank to Go Public.” Banker & Tradesman, March 12, 2014.
Anthony, Amy. “Nantucket Bank to Be Bought by Blue Hills.” Cape Cod Times (Hyannis, MA), August 6, 2013.
Brown, Matthew L. “Blue Hills Bank's Name and Strategy Change.” Boston Business Journal, October 19, 2012.
Focer, Ada. “On a List of the Best, Small Mean Beautiful.” Boston Business Journal, October 29, 1990.
“Hyde Park Savings Bank to Become Blue Hills Bank.” Banker & Tradesman, September 23, 2011.
McLaughlin, Tim. “Hyde Park Savings Has New CEO.” Boston Business Journal, June 23, 2010.
Micheli, Mark. “William Parent: President and CEO, Blue Hills Bank.” Banker & Tradesman, May 20, 2013.