July 17, 2009 / 7:05 PM / 9 years ago

UPDATE 1-People's United says open to FDIC-assisted deals

* Says open to FDIC-assisted deal outside Northeast

* Says targets banks not willing to sell

* Sees FDIC assessment to range from $4 mln to $5 mln

July 17 (Reuters) - People’s United Financial Inc (PBCT.O) says it is open to Federal Deposit Insurance Corp-assisted deals even outside its preferred geographical locations.

While the company continues to focus on acquisition opportunities within its desirable Northeast region — from Maine to Washington D.C. — it is also open to FDIC-assisted transactions in other geographies, Chief Executive Philip Sherringham said.

If the deal is within the stated corridor market, the company could look at smaller acquisitions of $200 million to $400 million, Sherringham said in a conference call.

If it is outside the Northeast region, the target bank has to be $2 billion to $5 billion in assets to make any sense, he said.

The Bridgeport, Connecticut-based company — one of the better-capitalized banks in the United States — has about $2.5 billion in excess cash and has been actively looking for acquisitions.

However, many target banks are not willing to sell themselves at the moment even at a significant premium to their current trading levels, Sherringham said.

People’s United, which competes with Northwest Bancorp NWSB.O, The Bancorp (TBBK.O) and First Niagara Financial Group FNFG.O, posted a 36 percent fall in second-quarter profit on Thursday, hurt by margin pressure, and said provision for loan losses rose six-fold for the period. [ID:nBNG530582]

The company, which was added to the S&P 500 Index .SPX last November, said it expects regular quarterly FDIC assessment to settle in at about $4 million to $5 million, up from $1.8 million for the second quarter.

Shares of the company, which were trading up 1 percent Friday morning on Nasdaq, fell as much as 4 percent to $15.15 later in the day.

They were trading down 3 percent at $15.26 in afternoon trade. (Reporting by Anurag Kotoky in Bangalore; Editing by Unnikrishnan Nair)

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