Connecticut and Massachusetts Launch First Energy Cooperatives With Financing From First International Bank

Consolidation In The Energy Industry Gives Rise To
Powerful New Cooperative Business Model in Southern New England

HARTFORD, Conn., Nov. 21, 2000—Energy cooperatives are commonplace across rural America, but recent energy deregulation in Massachusetts and Connecticut has given rise to Southern New England’s first two energy cooperatives, which powered up this Fall. Two organizations have capitalized on the energy-sector financing expertise of First International Bank, a subsidiary of First International Bancorp Inc. (NASDAQ: FNCE). Connecticut Energy Cooperative obtained a loan of nearly $500,000 guaranteed by the U.S. Small Business Administration, and Co-opPlus of Western Massachusetts obtained a $3.9 million loan backed by the U.S. Department of Agriculture (USDA).

With economic pressures driving many New England energy companies toward consolidation, creating a cooperative is an attractive option. Four local fuel oil dealers were combined in the formation of the two cooperatives financed by First International – Connecticut Energy Cooperative acquired Bloomfield-based Elanco, and Co-opPlus acquired Lacasse Heating & Cooling in Holyoke, Express Oil in Southampton, and Halon in Granby.

"First International is proud have played a major role in the formation of the first energy cooperatives in the Southern New England region," stated Paul Falvey, executive vice president and head of the First International’s Commercial Banking-East Division, which includes the Energy Finance business unit.

Financing the two nascent energy cooperatives is consistent with First International’s commitment to small and medium size industrial businesses and focus on innovative energy programs. Whereas conventional lenders might hesitate to finance an energy cooperative based on the risks of consortium ownership, commodity price volatility and the shortage of tangible assets, "First International was comforted by the key elements of both transactions," stated Matthew J. Ide, head of Energy Finance. "Both organizations have career managers at the helm, with many years of hands-on experience leading co-operative, financial and fuel industry operations," said Ide.

Falvey noted that federal government guarantees are pivotal to First International in its effort to help small industry succeed in the new global economy. "Federal agency backing gives First International Bank the opportunity to be a financing innovator and a great partner to small industrial companies as they strive to compete in the 21^st century," stated Falvey.

In addition to being a leading lender in the SBA 7(a) and USDA Business and Industry programs, First International works closely with the National Rural Utilities Cooperative Finance Corporation (CFC), the nation’s leading non-profit provider of financing to rural cooperative utilities.

About First International Bank and First International Bancorp Inc.

First International Bank (www.upscapital.com) – a world leader in the use of SBA, USDA and Export-Import Bank loans – provides innovative credit, trade and financial solutions for small and medium size industrial businesses. The company has more than 200 employees and representatives at 29 locations worldwide. U.S. offices are in Boston, Cleveland, Detroit, Hartford, Los Angeles, Miami, Morristown, Philadelphia, Pittsburgh, Providence, Richmond, Rochester, Springfield, St. Louis, and Washington, DC. International representatives are based in Argentina, Brazil, Central America, Egypt, India, Indonesia, Korea, Mexico, North Africa, the Philippines, Poland, South Africa, Turkey and West Africa. During 1999, the company originated $551 million in loans primarily within its industrial niche, and closed the year with a managed loan portfolio of $1.1 billion. Established in 1955, the bank is a subsidiary of publicly traded First International Bancorp Inc. (NASDAQ: FNCE), with headquarters in Hartford, Connecticut.

MEDIA CONTACT:

First International Bank
Michele Zommer
(860) 241-4705
zommerm@firstinterbank.com