Photo by James Sanna | Banker & Tradesman Staff

Cambridge Trust Co. plans to look for more wealth management opportunities north of Boston with its third bank acquisition in four years.

Cambridge Bancorp, Cambridge Trust’s parent company, announced Monday that it would acquire North Andover-based Northmark Bank in an all-stock deal valued at $63 million.

“This merger brings together two terrific, conservatively managed banks with a long track record of solid financial performance and a culture based upon deep customer relationships and service excellence,” Cambridge Trust President and CEO Denis Sheahan said during a conference call Tuesday to discuss the merger.

The transaction, which has been unanimously approved by the boards of directors at both companies, is expected to close in the fourth quarter. Jane Walsh, Northmark’s president and CEO, will join Cambridge Bancorp and Cambridge Trust as a director.

Founded in 1987 by Walsh and Northmark Chairman Daniel Murphy III, Northmark Bank has about $442 million in assets and branches in North Andover, Andover and Winchester. The merger will give Cambridge Trust about $5.5 billion in assets.

In addition to regulatory approval, the deal will need approval from the shareholders of Northmark, a privately held stock bank. Sheahan said in response to an analyst’s question that the board of directors holds 40 percent of Northmark’s stock, adding that board members have entered into a voting agreement to approve the merger

Northmark shareholders will receive 0.995 shares of Cambridge common stock for each share of Northmark stock. Based upon Cambridge’s closing price of $79.94 as of May 20, the transaction is valued at $79.54 per share of Northmark common stock, or approximately $63 million, Cambridge Trust said in a statement.

The deal will give Cambridge Trust its first Winchester branch and first two Essex County branches.

“These are attractive, affluent communities, consistent with our private banking and wealth management business models,” Sheahan said.

Cambridge Trust has 19 branches and five wealth management offices in Greater Boston and New Hampshire. The bank had previously acquired Wellesley Bank in 2020 and New Hampshire-based Optima Bank & Trust in 2019.

Cambridge Trust’s chief financial officer, Michael Carotenuto, said during the call that the bank expects 35 percent in cost savings from the acquisition, with a 1.7 percent dilution in its tangible book value. The bank expects to earn that back in 2.25 years.

While Cambridge Trust expects wealth management opportunities among Northmark’s customers, Sheahan said these opportunities were not included in revenue forecasts from the merger. He said in response to an analyst’s question that the bank would begin training Northmark employees about wealth management soon after completing the merger.

“It takes time to grow wealth, and that’s our experience from our prior mergers,” Sheahan said. “But these are terrific markets, and we would expect to have significant wealth opportunity with that client base and in those markets over time.”

In a letter posted on Northmark’s website, Walsh and Murphy thanked customers “for being part of our success.”

“Northmark Bank is a financially strong and competitive bank,” Walsh and Murphy said. “Deciding to merge has been a very thoughtful decision involving many important factors focusing on, among other things, the best interest for our clients and our employees. The decision to partner with Cambridge Trust reflects our bank’s belief that being part of Cambridge Trust, with their outstanding reputation, and strong financial standing, is in the best interest of all our clients.”