The parent company of Berkshire Bank said last night that it would purchase the parent company of Willimantic, Connecticut-based Savings Institute Bank & Trust in an all-stock transaction valued at $180 million.

The deal will benefit Berkshire’s regional presence and increases Berkshire’s lead as the largest Massachusetts state-chartered bank by assets, aside from State Street.

But the announcement has led to broader questions about the bank’s plans for its Boston franchise and the overall vision of the company after former longtime president and CEO Michael Daly recently left the bank amid uncertain circumstances, including accusations of a “toxic” workplace culture at the bank. Berkshire recently moved its headquarters to Boston, with plans to focus on the city and position itself as the next Fleet Bank.

“This deal, while the pricing looks good, is sort of a different tact than you’ve been guiding from most of the year,” analyst Laurie Hunsicker of Compass Point said on a conference call this morning discussing the acquisition. “What changed in October and now … what is your Boston focus?”

Hunsicker noted that in the third quarter, Daly had said that while the bank was in a position to react from an M&A standpoint, the core focus was on organic growth.

Since the third quarter, Berkshire has done anything but react to opportunities.

The bank missed out on buying Blue Hills Bank and Belmont Savings Bank, which would have solidified Berkshire’s presence in Boston. Berkshire currently has only four retail branches in Boston and there are very few acquisition candidates left in the city.

All of this happened while the bank was going through a CEO change. Daly, the CEO of Berkshire since 2002, left the bank right after Thanksgiving without a clear reason.

However, following his departure, Piper Jaffrey analyst Matthew Breese issued a research report suggesting the departure was related to a “toxic” workplace culture.

New Berkshire President and CEO Richard Marotta, who was making his first public appearance as CEO on the conference call, assured analysts that the bank is still focused on Boston, and that the Savings Institute deal presented good value.

“From a strategic perspective, this begins to fill in our Connecticut presence,” he said. “We can take our product suite and leverage it through the existing customer base to improve profitability.”

Berkshire Bank’s regional presence is a little quirky, with branches in Massachusetts, Connecticut, Vermont, New Jersey, upstate New York and Pennsylvania. Before the deal, Berkshire had nine branches in Connecticut. The Savings Institute acquisition adds another 18 branches in Eastern Connecticut. It also comes with five branches in Rhode Island, giving Berkshire its first retail presence in the Ocean State. 

Berkshire seemed to get a good price on Savings Institute, paying only 118 percent tangible book value, which is far below recent sellers in the Northeast, who have been getting 160 to 190 percent tangible book value.

That said, Savings Institute, the seventh largest state-chartered bank in the Nutmeg State, has also not been the best performer.

Its return on assets was only 0.66 percent at the end of the third quarter, and was only 0.36 percent at the end of 2017, according to the FDIC. Growth has been lagging over the past few years as well.

The deal vaults Berkshire further ahead of close Massachusetts competitors Eastern Bank and Rockland Trust in terms of assets. With the addition of Saving Institute’s $1.6 billion in assets, Berkshire will hold $13.6 billion in total assets.

Additionally, the deal gives Berkshire a strong deposit franchise.

Marotta said half of Saving Institute’s deposits in Connecticut are in communities where the bank leads in market share, and in rural communities with very little competition and low cost of deposits.

The deal is expected to close in the second quarter of 2019. Upon closing of the deal, Rheo A. Brouillard, president and CEO of Savings Institute and its parent company, will join the board of directors at Berkshire Bank.