Maine News Updates

AUGUSTA -- Kennebec Savings Bank, the Augusta-based thrift that unsuccessfully tried to merge with a local credit union earlier this year, has abandoned its bid for a federal charter.

The bank recently withdrew its application to be regulated by the federal Office of Thrift Supervision, according to the office’s Web site. Mark Johnston, Kennebec Savings’ president and chief executive officer, said a proposed overhaul of the U.S. banking system pending in Congress prompted the withdrawal.

“All of the advantages that we considered when making that decision are now up in the air,” Johnston said. “We are suspending our application at the moment until that bill moves through Congress.”

The application withdrawal comes after Kennebec Savings’ effort to merge with Augusta-based KV Federal Credit Union was defeated by credit union members in September. The bank, which is regulated by the Maine Bureau of Financial Institutions, would have needed the federal charter to merge with the credit union.

Johnston said the proposed merger was one of a number of reasons the bank applied for a federal charter. And the bank isn’t withdrawing its application as a result of the merger’s failure, he added.

“It is the reason why we didn’t withdraw it sooner,” Johnston said. “We couldn’t withdraw the application until the vote happened.”