WT Direct Merges with M&T Bank

Wilmington Trust announced today that it will merge with M&T Bank Corporation. Here's an excerpt from the press release:

Its merger with Wilmington Trust will extend M&T’s community banking franchise, and add to its market-leading positions in Upstate New York, Central Pennsylvania and the Mid-Atlantic region. M&T will acquire 48 branch locations in Delaware and 225 ATMs, and there is no overlap between branch networks. Following completion of the merger, M&T will operate approximately 800 branches and 2,000 ATMs in eight states, the District of Columbia and Ontario, Canada.

M&T expects to gain approximately $8.3 billion in deposits and $8.1 billion in loans from the merger (before acquisition accounting adjustments), giving M&T the top deposit share and a leading commercial lending position in Delaware.

For us savers, the noteworthy issue is that WTDirect is a division of Wilmington Trust FSB which is part of the bank holding company Wilmington Trust Corporation.

The worrisome issue for us savers is that M&T Bank hasn't been kind to its internet savings accounts. One of its internet divisions, OnBank, used to have a competitive savings account in 2008, but in 2009 the rate plummeted to 0.50%, and it's still 0.50% as of today. M&T Bank also offers the e-Money Market from its main bank website. Its rate also fell to 0.50% in 2009 and it remains at 0.50% as of today.

It's still too early to know how this merger will affect WTDirect. According to the press release, the merger is expected to close by mid-year 2011. After that I'm sure it'll take many months for the conversion to take place. Even after the merger, it's possible that M&T Bank will let WTDirect to continue without changing it too much. Hopefully that will be the case.