The Federal Reserve has approved M&T Bank’s pending purchase of People’s United Financial in Bridgeport, Conn. – nearly 380 days after the $7.6 billion deal was announced.
The Fed said in a press release late Friday that it will use next year’s stress test to recalculate M&T’s stress test buffer to include the impact of the acquisition. M&T typically runs on a two-year stress test cycle that includes this year.
The approval comes two weeks after the Buffalo, N.Y., company announced that the deadline for completing the deal had been extended from Feb. 21 to June 1.
The merger, announced in February 2021, was originally expected to close in the fourth quarter. State banking regulators in Connecticut and New York have already signed off on the deal.
M&T also reached an agreement with the National Community Reinvestment Coalition to provide $43 billion of financial support, including loans and investments, over a five-year period.
The $143 billion-asset M&T faced some criticism last year when it was revealed that job cuts were heavily weighted toward People’s United. The company said it would keep roughly 80% of the seller’s employees and keep at least 1,000 workers in Bridgeport for at least a year after it converting its systems.