UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

First Connecticut Bancorp, Inc.

(Exact name of registrant as specified in its charter)

Maryland (State or Other Jurisdiction of Incorporation or Organization)		6712 (Primary Standard Industrial Classification Code Number)		To be applied for (I.R.S. Employer Identification Number)

CALCULATION OF REGISTRATION FEE

Proposed Maximum

Proposed Maximum

Amount of

Title of Each Class of

Amount

Offering

Aggregate

Registration

Securities to be Registered

to be Registered

Price per Share

Offering Price(1)

Fee

Common Stock, $0.01 par value per share

15,817,150 shares (2)

$

10.00

$

137,540,000

$

15,968.40

(1)	Estimated solely for the purpose of calculating the registration fee.
(2)	Includes 608,400 shares to be issued to The Farmington Bank Community Foundation, Inc., a private foundation.

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

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PROSPECTUS

 

(Proposed Holding Company for Farmington Bank)

Up to 13,225,000 Shares of Common Stock

(Subject to increase to up to 15,208,750 shares)

$10.00 per Share

 

This is the initial public offering of shares of common stock of First Connecticut Bancorp, Inc., (“FCB”).  FCB is a Maryland corporation that was recently formed in connection with the conversion of First Connecticut Bancorp, Inc., a Connecticut-chartered mutual holding company, or the MHC, from the mutual to the stock form of organization. The MHC currently owns all of the outstanding stock of Farmington Bank, a Connecticut-chartered savings bank. The MHC will cease to exist as a result of the conversion, and FCB will own all of the common stock of Farmington Bank. We expect that the common stock of FCB will be quoted on the Nasdaq Global Market under the symbol “FBNK”  All shares offered for sale are being offered at a price of $10.00 per share.

 

FCB is offering for sale up to 13,225,000 shares of its common stock on a best efforts basis, which will include shares of FCB common stock to be issued to an employee stock ownership plan established by FCB equal to 8.0% of the shares to be issued in the offering. We will also issue an additional number of shares equal to 4.0% of the shares issued in the offering to a charitable foundation to be established by Farmington Bank.  We must sell a minimum of 9,775,000 shares in order to complete the offering, and we will terminate the offering if we do not sell the minimum number of shares. We may sell up to 15,208,750 shares in the event of a greater demand for our shares or changes in market or economic conditions without resoliciting subscribers.

 

We are offering shares of common stock in a “subscription offering” to eligible depositors and our tax-qualified employee stock benefit plans.  Shares of common stock not subscribed for in the subscription offering will be offered for sale to the general public in a “community offering,” with a preference given first to natural persons residing in Hartford County, Connecticut, then to all other natural persons residing in Connecticut. We also may offer for sale shares of common stock not subscribed for in the subscription offering or community offering in a “syndicated community offering” through a syndicate of selected dealers managed by Keefe, Bruyette & Woods, Inc.

 

The minimum number of shares you may order is 25 shares.  The maximum purchase that an individual may make through a single deposit account is 40,000 shares, and no individual acting alone, or with an associate or group of persons acting in concert, may purchase more than 100,000 shares. The offering is expected to expire at 12:00 noon, Eastern Time, on [Date 1], but we may extend this expiration date without notice to you until [Date 2] or longer if the Connecticut Banking Commissioner approves a later date.  Once submitted, orders are irrevocable unless the offering is terminated or is extended beyond [Date 2], or the number of shares of common stock to be sold is increased to more than 15,208,750 shares or decreased to less than 9,775,000 shares, in which event we will resolicit subscribers, and you will have the opportunity to confirm, change or cancel your order.  If you do not provide us with a written indication of your intent, your funds will be returned to you, with interest. Funds received prior to the completion of the offering will be held in a segregated account at Farmington Bank.  All subscriptions received will bear interest at Farmington Bank’s passbook savings rate, which is currently 0.2% per annum.

 

Keefe, Bruyette & Woods, Inc. will use its best efforts to assist us in selling our common stock, but is not obligated to purchase any of the common stock that is being offered for sale. Subscribers will not pay any commissions to purchase shares of common stock in the offering. There is currently no public market for the common stock. Keefe, Bruyette & Woods, Inc. has advised us that it intends to make a market in the common stock, but is under no obligation to do so.

 

 

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OFFERING SUMMARY

Price: $10.00 per Share

 

		Minimum				Midpoint				Maximum				Adjusted Maximum
Number of shares:			9,775,000				11,500,000				13,225,000				15,208,750
Gross offering proceeds:		$	97,750,000			$	115,000,000			$	132,250,000			$	152,087,500
Estimated offering expenses, excluding selling agent fees and expenses:		$	1,580,500			$	1,580,500			$	1,580,500			$	1,580,500
Selling agent fees and expenses (1) :		$	1,021,422			$	1,179,570			$	1,337,718			$	1,519,588
Estimated net proceeds:		$	95,148,078			$	112,239,930			$	129,331,782			$	148,987,412
Estimated net proceeds per share:		$	9.73			$	9.76			$	9.78			$	9.80

 

(1)

Includes: (i) a management fee payable by us to Keefe, Bruyette &Woods, Inc. and costs of underwriting counsel totaling $150,000; and (ii) fees payable by us to Keefe, Bruyette & Woods, Inc. in connection with the subscription and community offerings equal to 1.0% of the aggregate amount of common stock sold in the subscription and community offerings (net of insider purchases and shares purchased by our employee stock ownership plan and other tax-qualified employee stock benefit plans).  See “UNAUDITED PRO FORMA DATA” and “THE CONVERSION AND THE OFFERING – Plan of Distribution”.

 

THESE SECURITIES ARE NOT BANK DEPOSITS AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY, NOR ARE THEY OBLIGATIONS OF, OR GUARANTEED BY, A BANK.

 

THESE SECURITIES INVOLVE INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL. PLEASE READ CAREFULLY THE SECTION ENTITLED “RISK FACTORS” BEGINNING ON PAGE ___ OF THIS PROSPECTUS.

 

NEITHER THE STATE OF CONNECTICUT DEPARTMENT OF BANKING, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE U.S. SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION NOR ANY OTHER REGULATORY BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

Keefe, Bruyette & Woods, Inc.

 

For assistance, please contact the Stock Information Center at (877) ____-______.

The date of this prospectus is _________ __, 2011

 

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[MAP TO BE INSERTED HERE]

 

 

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TABLE OF CONTENTS

 

		Page
SUMMARY		7
RISK FACTORS		26
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA		35
FORWARD-LOOKING STATEMENTS		38
HOW WE INTEND TO USE THE PROCEEDS FROM THE OFFERING		39
OUR DIVIDEND POLICY		41
MARKET FOR THE COMMON STOCK		42
HISTORICAL AND UNAUDITED PRO FORMA REGULATORY CAPITAL COMPLIANCE		42
CAPITALIZATION		44
UNAUDITED PRO FORMA DATA		45
COMPARISON OF VALUATION AND UNAUDITED PRO FORMA INFORMATION WITH AND WITHOUT THE FOUNDATION		51
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		53
BUSINESS OF FCB		82
BUSINESS OF FARMINGTON BANK		82
SUPERVISION AND REGULATION		119
FEDERAL AND STATE TAXATION		128
MANAGEMENT		129
COMPENSATION DISCUSSION AND ANALYSIS		134
COMPENSATION OF EXECUTIVE OFFICERS AND TRANSACTIONS WITH MANAGEMENT		143
SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS		149
THE CONVERSION AND THE OFFERING		150
FARMINGTON BANK COMMUNITY FOUNDATION, INC.		172
DESCRIPTION OF CAPITAL STOCK AND STOCKHOLDERS’ RIGHTS OF FCB		176
RESTRICTIONS ON ACQUISITION OF FCB		177
TRANSFER AGENT		182
EXPERTS		182
LEGAL MATTERS		183
WHERE YOU CAN FIND ADDITIONAL INFORMATION		183
CONSOLIDATED FINANCIAL STATEMENTS		F-1
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS		II-1
SIGNATURES		II-7
POWER OF ATTORNEY		II-7
EXHIBIT INDEX		II-8

 

 

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SUMMARY

 

The following summary explains the significant aspects of the conversion, the related offering and the business of FCB and Farmington Bank. It may not contain all of the information that is important to you. For additional information and before making an investment decision, you should read this entire document carefully, including the consolidated financial statements and the section entitled “ RISK FACTORS ” .

 

Our Organization

 

Farmington Bank began business as Farmington Savings Bank in 1851.  In March 2006, Farmington Bank reorganized into the single-tier mutual holding company structure. As part of the reorganization, Farmington Bank formed the MHC, a Connecticut-chartered mutual holding company. Farmington Bank became a Connecticut-chartered capital stock savings bank and a wholly-owned subsidiary of the MHC.  Upon the completion of the conversion and stock offering, Farmington Bank will be a wholly owned subsidiary of FCB. The directors of Farmington Bank will also serve as the directors of FCB.  Certain of the officers of Farmington Bank will also serve as officers of FCB without additional compensation.

 

The Companies

 

First Connecticut Bancorp, Inc.

 

FCB has been organized as a Maryland chartered stock holding company and will own 100% of the common stock of Farmington Bank after the completion of the conversion. FCB has not engaged in any business to date. After the conversion, FCB will replace the MHC as the owner of all of the stock of Farmington Bank.  The executive office of FCB is located at One Farm Glen Boulevard, Farmington, Connecticut, and its telephone number is (860) 676-4600.

 

Farmington Bank

 

Farmington Bank is a full-service, community bank with 15 full service branch offices and 4 limited service offices, including our main office, located throughout Hartford County, Connecticut.   Farmington Bank provides a diverse range of commercial and consumer services to businesses, individuals and governments across Central Connecticut. Farmington Bank is regulated by the Connecticut Department of Banking and the Federal Deposit Insurance Corporation (“FDIC”).  Farmington Bank’s deposits are insured to the maximum allowable under the Deposit Insurance Fund, which is administered by the FDIC.  Farmington Bank is a member of the Federal Home Loan Bank of Boston (“FHLBB”). Farmington Bank is currently the wholly owned subsidiary of the MHC. On a consolidated basis, as of September 30, 2010, the MHC and Farmington Bank had approximately $1.5 billion in assets, $1.2 billion in deposits and capital accounts of approximately $97.9 million.

 

Our main office is located at One Farm Glen Boulevard, Farmington, Connecticut, and our telephone number is (860) 676-4600. Our website address is www.farmingtonbankct.com. Information on our website should not be considered a part of this prospectus.

 

Our Business

 

We provide a full range of banking services to businesses, individuals and governments in Central Connecticut.  Our business is headed by a seasoned management team with experience in commercial and residential lending at financial institutions throughout New England.  This management team was brought on commencing in 2008, highlighted by the addition of John J. Patrick Jr.  in March 2008 as our President and Chief Executive Officer.  Mr. Patrick was also named Chairman of our board of directors in July 2008.  Mr. Patrick is a former President and Chief Executive Officer of TD Banknorth, Connecticut division and, prior to that, Mr. Patrick was President of Glastonbury Bank & Trust Co., now part of TD Bank.  Mr. Patrick and the other members of our management team, including Gregory White, our Chief Financial Officer, Michael Schweighoffer, our Chief Risk Officer, and David Blitz, our Director of Commercial Banking, each of whom joined Farmington Bank in 2009, have extensive experience in such areas as commercial and consumer lending, credit analysis and risk management and in leading growth initiatives of other financial institutions.

 

 

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The goal of our new management team is to make Farmington Bank the premier commercial bank in Central Connecticut with an emphasis on growing our commercial loan assets and services.  Under the supervision of our new management team, we have made significant changes to our business structure including:

 

●	strengthening our risk management and compliance procedures;

 

●	implementing an expansion strategy, including the opening of three new branches since 2008;

 

●	adding cash management services, government banking and small business banking;

 

●	doubling the number of our commercial lenders and recruiting other experienced personnel to strengthen our finance department;

 

●	implementing a secondary market lending program; and

 

●	enhancing technology to support our risk management program.

 

We also continue to offer a full range of residential mortgage loan services.  We intend to continue to invest in people, technology and the business of serving our customers as we pursue our strategic initiatives.

 

For the period of December 30, 2009 through September 30, 2010, we experienced asset growth of $257.2 million or 20.5%. We employed 260 full-time equivalent employees as of September 30, 2010. See “BUSINESS OF FARMINGTON BANK” for a more detailed discussion of our business.

 

Our Business Strategy

 

Our business strategy is to operate as a well-capitalized and profitable community bank for businesses, individuals and governments.  Our branch franchise extends throughout Hartford County with lending throughout the State of Connecticut. The key elements of our operating strategy include:

 

●	maintaining a   strong capital position in excess of the well-capitalized standards set by our banking regulators to support our current operations and future growth;

 

●	increasing our focus on commercial lending and continuing to expand commercial banking operations;

 

●	continuing to focus on consumer and residential lending;

 

 

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●	maintaining asset quality and prudent lending standards;

 

●	expanding our existing products and services and developing new products and services to meet the changing needs of consumers and businesses in our market area;

 

●	continuing expansion through de novo branching with a current goal of adding two to three de novo branches each year for so long as the deposit and loan generating environment continues to be favorable;

 

●	taking advantage of acquisition opportunities that are consistent with our strategic growth plans; and

 

●	continuing our efforts to control non-interest expenses.

 

See “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS – Our Business Strategy” for a more detailed discussion of our business strategy.

 

Our Market Area

 

We operate in a primarily suburban market area that has a stable population and household base. All of our current offices are in Hartford County, Connecticut. Our primary market area is Central Connecticut. Our main office is in Farmington, Connecticut and is approximately ten miles from the City of Hartford, Connecticut. Hartford County has a mix of industry groups and employment sectors including insurance, health services, finance, manufacturing, not-for-profit, education, government and technology. Our primary market area for deposits includes the communities in which we maintain our banking office locations. Our lending area is broader than our deposit market area and includes, in addition to Hartford County, other areas of Connecticut.  In certain circumstances, we will make loans outside the State of Connecticut.

 

Changes in Corporate Structure

 

Currently, the MHC is a Connecticut-chartered mutual holding company with no stockholders. The MHC owns all of the outstanding stock of Farmington Bank, a Connecticut-chartered savings bank.

 

The mutual-to-stock conversion involves a series of transactions by which we will convert the MHC from a mutual form of organization to a public stock holding company form of organization. In the public stock holding company structure, Farmington Bank will become a wholly-owned subsidiary of a Maryland corporation known as First Connecticut Bancorp, Inc., or “FCB,” and all of the outstanding common stock of FCB will be owned by the public, including our employee stock ownership plan, and by a charitable foundation established by Farmington Bank.

 

After the conversion, our ownership structure will be as follows:

 

 

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Our normal business operations will continue without interruption during the conversion. The same corporators who adopted the plan of conversion and who continue to be corporators of the MHC at the time of the conversion will serve as members of an advisory board of FCB and Farmington Bank after the conversion. The executive officers of FCB and Farmington Bank will be the persons who are currently executive officers of the MHC and Farmington Bank. Please see “THE CONVERSION AND OFFERING” for a more detailed discussion of the terms of the offering.

 

 

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Reasons for the Conversion and the Stock Offering

 

The reasons for the conversion and our decision to conduct the offering are to:

 

●	provide us with additional capital to support our organic strategic growth plans;

 

●	maintain a strong capital position exceeding regulatory guidelines;

 

●	achieve enhanced profitability by growing our assets and otherwise positioning us to successfully compete in a competitive financial services marketplace;

 

●	increase our franchise and stockholder value;

 

●	expand products and services to meet the needs of our customers;

 

●	allow us to continue to retain and attract talented and experienced employees through stock based compensation; and

 

●	increase our philanthropic endeavors to the communities we serve through the formation and funding of a new charitable foundation.

Terms of the Offering

 

We are first offering shares of our common stock in a subscription offering to eligible depositors and our tax-qualified employee stock benefit plans. Shares of common stock not subscribed for in the subscription offering will be offered for sale to the general public in a community offering, with a preference given first to natural persons residing in Hartford County in Connecticut, then to all other natural persons residing in Connecticut. We also may offer for sale shares of common stock not subscribed for in the subscription offering or community offering in a syndicated community offering to be managed by Keefe, Bruyette & Woods, Inc.

 

We are offering for sale between 9,775,000 and 13,225,000 shares of common stock on a best efforts basis.  All shares of common stock are being offered for sale at a price of $10.00 per share.  All investors will pay the same purchase price per share.  Investors will not be charged a commission to purchase shares of common stock in the offering.  The amount of capital being raised is based on an independent appraisal of FCB. In the event of a greater demand for shares of our common stock or a change in financial or market conditions, with the Connecticut Banking Commissioner’s approval, we may sell up to 15,208,750 shares without giving you further notice or providing you with the opportunity to change or cancel your order.

 

The offering is expected to expire at 12:00 noon, Eastern Time, on [Date 1], but we may extend this expiration date without notice to you until [Date 2] or longer if the Connecticut Banking Commissioner approves a later date. Once submitted, orders are irrevocable unless the offering is terminated or is extended beyond [Date 2], or the number of shares of common stock to be sold is increased to more than 15,208,750 shares or decreased to less than 9,775,000 shares.  In the event the offering is extended beyond [Date 2] or the number of shares of common stock to be sold is increased to more than 15,208,750 shares or decreased to less than 9,775,000 shares, we will resolicit subscribers, and you will have the opportunity to confirm, change or cancel your order.  If you do not provide us with a written indication of your intent, your funds will be returned to you, with interest. Funds received prior to the completion of the offering will be held in a segregated account at Farmington Bank. All subscriptions received will bear interest at Farmington Bank’s passbook savings rate, which is currently 0.2% per annum.

 

 

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Keefe, Bruyette & Woods, Inc., our marketing advisor and sales agent in the offering, will use its best efforts to assist us in selling shares of our common stock.  However, Keefe, Bruyette & Woods, Inc. is not obligated to purchase any shares of common stock in the offering.

 

How We Intend to Use the Proceeds From the Offering

 

The following table summarizes how we intend to use the proceeds of the offering, based on the sale of shares at the minimum, midpoint, maximum and adjusted maximum of the offering range, assuming that all of the shares of common stock will be sold in the subscription and community offerings.

 

(In Thousands)		Minimum 9,775,000 Shares at $10.00 per share				Midpoint 11,500,000 Shares at $10.00 per share				Maximum 13,225,000 Shares at $10.00 per share				Adjusted Maximum 15,208,750 Shares at $10.00 per share
Gross offering proceeds		$	97,750			$	115,000			$	132,250			$	152,088
Less: offering expenses			2,602				2,760				2,918				3,100
Net offering proceeds			95,148				112,240				129,332				148,988
Distribution of net proceeds:
Proceeds contributed to Farmington Bank		$	47,574			$	56,120			$	64,666			$	74,494
Loan to employee stock ownership plan			8,133				9,568				11,003				12,654
Proceeds retained by  FCB		$	39,441			$	46,552			$	53,663			$	61,840

 

Initially, we intend to invest the proceeds retained in the offering by FCB in short-term liquid investments, such as U.S. treasury and government agency securities, mortgage-backed securities and cash and cash equivalents, deposit the funds in Farmington Bank, or repay certain short-term borrowings.  FCB may also use the funds, subject to any regulatory restrictions, to:

 

●	contribute additional capital to Farmington Bank;

 

●	fund strategic growth opportunities, including the acquisition of other banking institutions or other financial services related businesses (although there are no plans for any such acquisitions at this time);

 

●	pay cash dividends to stockholders;

 

●	fund stock based compensation plans and other general corporate purposes;

 

●	repurchase shares of its common stock; and

 

●	other general corporate purposes.

 

The proceeds contributed to Farmington Bank by FCB will be used by Farmington Bank to support its general business operations. The proceeds will be utilized by Farmington Bank to grow its balance sheet through loan origination, deposit generation and enhancing existing products and services along with supporting the development of new products and services.  In addition, in the future the funds are expected to be used by Farmington Bank to finance de novo branching. Farmington Bank expects to continue to extend its branch network at a rate of approximately two to three new branches per year for so long as the deposit and loan generating environment continues to be favorable.

 

 

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Please see the section of this prospectus entitled “HOW WE INTEND TO USE THE PROCEEDS FROM THE OFFERING” for more information on the proposed use of the proceeds from the offering.

 

How We Determined the Offering Range

 

The amount of common stock we are offering is based on an independent appraisal of the estimated market value of FCB, assuming the conversion and offering are completed. RP Financial, LC. (“RP Financial”), our independent appraiser, has estimated that, as of December 14, 2010, the estimated pro forma market value of the common stock of FCB, including shares sold in the offering and contributed to the charitable foundation, was $119,600,000.  This pro forma market value is the midpoint of a valuation range established by regulation with a minimum of $101,660,000 and a maximum of $137,540,000.  Based on this valuation and the $10.00 per share price, the number of shares of our common stock that will be outstanding upon completion of the stock offering, including shares sold in the offering and contributed to the charitable foundation, will range from 10,166,000 to 13,754,000 with a midpoint of 11,960,000, and the number of shares of our common stock that will be sold in the stock offering will range from 9,775,000 shares to 13,225,000 shares with a midpoint of 11,500,000 shares.

 

If a greater demand for shares of our common stock or a change in financial or market conditions warrant, the offering range may be increased by 15.0%, which would result in an adjusted maximum pro forma market value, including shares sold in the offering and contributed to the charitable foundation, of $158,171,000, total shares outstanding of 15,817,100 and total shares sold in the stock offering of 15,208,750.  If the appraised value changes to either below $101,660,000 or above $158,171,000, we will resolicit persons who submitted stock orders and you will have the opportunity to confirm, change or cancel your order.

 

The appraisal was based in part on our consolidated financial condition and results of operations, the pro forma effect of the additional capital raised by the sale of shares of our common stock in the offering, and an analysis of a peer group of ten publicly-traded companies utilized by RP Financial in its appraisal that RP Financial considers comparable to FCB, as listed below.

 

Ticker		Financial Institution		Exchange		Primary Market		Total Assets (in millions)
ABBC		Abington Bancorp, Inc. of PA		NASDAQ		Jenkintown, PA		$	1,258
BFED		Beacon Federal Bancorp of NY		NASDAQ		East Syracuse, NY			1,059
BRKL		Brookline Bancorp, Inc. of MA		NASDAQ		Brookline, MA			2,660
CBNJ		Cape Bancorp, Inc. of NJ		NASDAQ		Cape May, NJ			1,054
DNBK		Danvers Bancorp, Inc. of MA		NASDAQ		Danvers, MA			2,631
ESSA		ESSA Bancorp, Inc. of MA		NASDAQ		Stroudsburg, PA			1,072
CSHC		Ocean Shore Holding Co. of NJ		NASDAQ		Ocean City, NJ			838
OCFC		OceanFirst Financial Corp. of NJ		NASDAQ		Toms River, NJ			2,225
UBNK		United Financial Bancorp of MA		NASDAQ		W. Springfield, MA			1,545
WFD		Westfield Financial Inc. of MA		NASDAQ		Westfield, MA			1,253

 

In selecting the comparable group companies, RP Financial limited the group to financial institutions located in New England and the Mid-Atlantic regions of the United States whose common stock is traded on a national securities exchange. The group was further limited by asset size, tangible capital ratio and earnings factors.

 

 

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In preparing its appraisal, RP Financial considered the information in this prospectus, including our financial statements.  RP Financial also considered the following factors, among others:

 

●	our historical, present and projected operating results and financial condition;

●	the economic, demographic and competition characteristics of our market area;

●	a comparative evaluation of our operating and financial statistics with those of other similarly-situated, publicly-traded thrifts and thrift holding companies;

●	the effect of the capital raised in this offering on our net worth and earnings potential; and

●	the trading market for securities of comparable institutions and general economic conditions in the market for such securities.

 

Three measures that investors often use to analyze an issuer’s stock are the ratio of the offering price to the issuer’s reported book value, the ratio of the offering price to the issuer’s tangible book value  and the ratio of the offering price to the issuer’s annual net income. According to RP Financial, while appraisers (as well as investors) use all of these ratios to evaluate an issuer’s stock, the price-to-book-value ratio has historically been the most frequently used method due to the volatility of earnings in the thrift industry in the mid-to-late 2000’s and, more recently, due to decreasing interest rates and increased expenses related to credit quality. Tangible book value is total equity less intangible assets. Book value is the same as total equity and represents the difference between the issuer’s assets and liabilities. Core earnings, a non-GAAP measure, is defined as net income before extraordinary items, less the after-tax portion of income from the sale of investment securities or loans and nonrecurring items. RP Financial considered these ratios, among other factors, in preparing its appraisal.

 

The following table presents a summary of selected pricing ratios for us and the peer group companies, utilized by RP Financial in its appraisal. These ratios are based on estimated core earnings for the 12 months ended September 30, 2010 and book value as of September 30, 2010. The September 30, 2010 data was utilized as it is the latest financial information presented to investors in this offering circular.

 

		Price-to-Core Earnings Multiple (1)				Price-to-Book Value Ratio				Price-to-Tangible Book Value Ratio
FCB (on a pro forma basis)
Minimum			23.01	x			55.80	%			55.80	%
Midpoint			27.97	x			60.61	%			60.61	%
Maximum			33.26	x			64.72	%			64.72	%
Adjusted Maximum			39.81	x			68.78	%			68.78	%
Peer group companies as of December 14, 2010
Average			18.92	x			102.72	%			107.63	%
Median			17.00	x			106.58	%			108.77	%

 

(1)	Based on trailing twelve months net income through September 30, 2010, adjusted by RP Financial to reflect estimated recurring “core” income.

 

Compared to the average pricing ratios of the peer group, our pro forma pricing ratios at the maximum of the offering range indicated a 75.8% premium on a price-to-core earnings basis, a discount of 37.0% on a price-to-book basis and a discount of 39.9% on a price-to-tangible book basis.  This means that, at the maximum of the offering range, a share of our common stock would be less expensive than the peer group on a book value and tangible book value basis.

 

 

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Compared to the median pricing ratios of the peer group, our pro forma pricing ratios at the maximum of the offering range indicated a 95.6% premium on a price-to-core earnings basis, a discount of 39.3% on a price-to-book basis and a 40.5% discount on a price-to-tangible book basis. This means that, at the maximum of the offering range, a share of our common stock would be less expensive than the peer group on a book value and tangible book value basis. For more information, see “UNAUDITED PRO FORMA DATA”.

 

Our board of directors determined that the offering range was reasonable and appropriate after considering the different elements of the appraisal, the methodology utilized by RP Financial and the conclusions set forth in the appraisal report. The board of directors considered the range of price-to-earnings multiples and the range of price-to-book value and price-to-tangible book value ratios at the different amounts of shares to be sold in the offering, but did not consider one valuation approach to be more important than the other. Rather, in approving the appraisal, the board of directors concluded that these ranges represented the appropriate balance of the approaches to establishing our valuation, and the number of shares to be sold, in comparison to the peer group institutions. The estimated appraised value took into consideration the potential financial impact of the offering and the stock contribution to the charitable foundation.

 

In addition, we intend to issue shares of common stock to Farmington Bank Community Foundation, Inc. The shares issued will be equal to 4.00% of the total of the shares sold in the offering, representing 3.85% of all shares issued and outstanding after the offering. The contribution of common stock to the charitable foundation will have the effect of reducing our pro forma valuation. See “COMPARISON OF VALUATION AND UNAUDITED PRO FORMA INFORMATION WITH AND WITHOUT THE FOUNDATION” beginning on page [___] of this prospectus.

 

The appraisal is not intended, and must not be construed, as a recommendation of any kind as to the advisability of purchasing our common stock. The independent appraisal does not indicate market value.  You should not assume or expect that our valuation as indicated in the appraisal means that after the offering the shares of our common stock will trade at or above the $10.00 per share purchase price.  Furthermore, the pricing ratios presented in the appraisal were utilized by RP Financial to estimate our market value and not to compare the relative value of shares of our common stock with the value of the capital stock of the peer group.  Because of differences in important factors such as operating characteristics, location, financial performance, asset size, capital structure and business prospects between us and other fully converted institutions, you should not rely on these comparative valuation ratios as an indication as to whether or not our common stock is an appropriate investment for you.

After-Market Performance Information

 

The appraisal prepared by RP Financial includes examples of after-market stock price performance for standard mutual-to-stock conversion offerings ( i.e. , excluding “second step” conversions by publicly traded mutual holding companies) completed during the three-month period ended December 14, 2010).  The following table presents stock price appreciation information for all standard mutual-to-stock conversions completed between January 1, 2010 and December 14, 2010.  These companies did not constitute the group of ten comparable public companies utilized in RP Financial’s valuation analysis.

 

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Standard Conversion Offerings Completed Closing Dates between January 1, 2010 and December 14, 2010
										Price Performance from Initial Trading Date
Transaction		Exchange		Closing Date		Offering Size				1 day				1 week				1 month				14-Dec-10
						($ in Millions)
SP Bancorp, Inc. (SPBC)		NASDAQ		11/01/10		$	17.3				-6.0	%			-6.6	%			-8.0	%			-10.1	%
Standard Financial Corp. (STND)		NASDAQ		10/07/10		$	33.6				19.0	%			18.9	%			29.5	%			33.1	%
Madison Bancorp, Inc. (MDSN)		OTC		10/07/10		$	6.1				25.0	%			25.0	%			25.0	%			7.5	%
Century Next Financial Corp. (CTUY)		OTC		10/01/10		$	10.6				25.0	%			15.0	%			10.0	%			12.0	%
Peoples Federal Bancshares, Inc. (PEOP)		NASDAQ		07/07/10		$	66.1				4.0	%			6.9	%			4.2	%			28.5	%
Fairmount Bancorp, Inc. (FMTB)		OTC		06/03/10		$	4.4				10.0	%			20.0	%			10.0	%			26.0	%
Harvard Illinois Bancorp, Inc. (HARI)		OTC		04/09/10		$	7.9				0.0	%			0.0	%			-1.0	%			-44.0	%
OAB Financial Services, Inc. (OBAF)		NASDAQ		01/22/10		$	46.3				3.9	%			1.1	%			3.0	%			26.5	%
OmniAmerican Bancorp, Inc. (OABC)		NASDAQ		01/21/10		$	119.0				18.5	%			13.2	%			9.9	%			29.4	%
Versailles Financial Corp. (VERF)		OTC		01/13/10		$	4.3				0.0	%			0.0	%			0.0	%			0.0	%
Athens Bancshares, Inc. (AFCB)		NASDQ		01/07/10		$	26.8				16.0	%			13.9	%			10.6	%			13.6	%
Average						$	31.1				10.5	%			9.8	%			8.5	%			11.1	%
Median						$	17.3				10.0	%			13.2	%			9.9	%			13.6	%
NASDAQ Average						$	51.5				9.2	%			7.9	%			8.2	%			20.2	%
NASDAQ Median						$	40.0				10.0	%			10.1	%			7.1	%			27.5	%

		Number of Shares or Options to be Granted												Value of New Available Grants
		At Adjusted Maximum of Offering Range				As a percentage of Common Stock to be Issued in the Offering and to the Foundation				As a percentage of Common Stock to be Outstanding Total (1)				Maximum Dilution Resulting from the Issuance of Shares for Stock Benefit Plans				At Adjusted Maximum of Offering
																	(In Thousands)
Employee stock ownership plan			1,265,368				8.00	%			8.00	%			0.00	%		$	12,654	(2)
Restricted Stock Plan			632,684				4.00	%			4.00	%			3.85	%		$	6,327	(2) (3)
Stock option plan			1,581,710				10.00	%			10.00	%			9.09	%		$	5,188	(3)
Total			3,479,762				22.00	%			22.00	%			12.28	%		$	24,169

Exercise Price		Grant-Date Fair Value Per Option				1,016,600 Options at Minimum of Range				1,196,000 Options at Midpoint of Range				1,375,400 Options at  Maximum of Range				1,581,710 Options at Adjusted Maximum of Range
$      8.00		$	2.62			$	2,663,492			$	3,133,520			$	3,603,548			$	4,144,080
10.00			3.28				3,334,448				3,922,880				4,511,312				5,188,009
12.00			3.94				4,005,404				4,712,240				5,419,076				6,231,937
14.00			4.59				4,666,194				5,489,640				6,313,086				7,260,049

Share Price		406,640 Shares Awarded at Minimum of Range				478,400 Shares Awarded at Midpoint of Range				550,160 Shares Awarded at Maximum of Range				632,680 Shares Awarded at Adjusted Maximum of Range
$      8.00		$	3,253,120			$	3,827,200			$	4,401,280			$	5,061,440
10.00			4,066,400				4,784,000				5,501,600				6,326,800
12.00			4,879,680				5,740,800				6,601,920				7,592,160
14.00			5,692,960				6,697,600				7,702,240				8,857,520

Our Dividend Policy

 

Following completion of the offering, our board of directors will have the authority to declare dividends on our common stock, subject to statutory and regulatory requirements. In the future, our board of directors intends to consider a policy of paying cash dividends on the common stock. However, no decision has been made with respect to the payment of dividends. The payment of dividends will depend upon a number of factors, including capital requirements, FCB’s and Farmington Bank’s financial condition and results of operations, tax considerations, statutory and regulatory limitations and general economic conditions and regulatory restrictions that affect the payment of dividends by Farmington Bank to FCB. No assurances can be given that any dividends will be paid or that, if paid, will not be reduced or eliminated in the future. Special cash dividends, stock dividends or returns of capital, to the extent permitted by applicable policy and regulation, may be paid in addition to, or in lieu of, regular cash dividends.

Restrictions on the Acquisition of FCB and Farmington Bank

Maryland and Connecticut law, as well as provisions contained in the plan of conversion and FCB’s Certificate of Incorporation, restricts the ability of any person, firm or entity to acquire FCB, Farmington Bank, or their respective capital stock. The restrictions in FCB’s Certificate of Incorporation include the requirement that for a period of seven years from the completion of the offering a potential acquirer of common stock obtain the prior approval of the Connecticut Banking Commissioner before acquiring in excess of 10% of the voting stock of FCB or Farmington Bank.

Proposed Stock Purchases by Management

FCB’s directors and executive officers and their associates are expected to purchase approximately 247,500 shares of common stock in the offering, which represents 2.43%, 2.07%, 1.86% and 1.56% of the shares outstanding upon the completion of the conversion and offering, at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively. Directors and executive officers will pay the same $10.00 per share price paid by all other persons who purchase shares in the offering. These shares will be counted in determining whether the minimum of the range of the offering is reached. Directors and executive officers and their associates may not purchase greater than 25% of the outstanding shares of common stock of FCB.

How You Can Obtain Additional Information—Stock Information Center

Our banking personnel may not, by law, assist with investment-related questions about the offering. If you have any questions regarding the offering, please call our Stock Information Center, Monday through Friday between 9:00 a.m. and 5:00 p.m., Eastern Time.  The Stock Information Center will be closed on weekends and bank holidays.  The toll-free phone number is (   ) ___-____. In addition, a representative of Keefe, Bruyette and Woods, Inc. will be available to meet with you in person between 10:00 a.m. and 5:00 p.m. at our administrative office at One Farm Glen Boulevard, Farmington, Connecticut.

 

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