A Growing Midwestern Presence
The acquisition will add nearly 200,000 new customer relationships and will integrate all employees associated with the 52 branches, Drew Ottaway — Flagstar's executive vice president, Michigan market president and managing director of lending —told Benzinga.
The acquisition comes as part of Flagstar’s efforts to increase presence in the Midwest and across the country. At the closing of this acquisition, Flagstar will have 151 Midwestern branches and eight California branches.
Doubling Flagstar's Customer Count
“We’ve been looking for ways to expand meaningfully in the Midwest market, it’s a market we know well,” Ottaway said.
The acquisition of the branches in Indiana, Michigan, Wisconsin and Ohio “fits the bill perfectly” as it is close to and contiguous with the bank's existing Michigan market, he said.
Outside of geographic convenience, the acquisition offers an opportunity to support “continued growth and diversification," Ottaway said.
“If you think about the deposit base, the customer base and the geography, it really is a good fit and will nearly double our existing customer count."
Expansion Adds Liquidity
Flagstar's set of products and services are "very competitive" and comparable to any national bank, and while there is no real need to add on to them, Flagstar routinely invests in and refines its offerings, Ottaway said.
The transaction will bring liquidity that can help the company pay back short-term Federal Home Loan Bank Advances. In the long run, the larger branch network will “expand assets to core deposits and other business opportunities," according to Flagstar.
The bank said it will focus on ensuring a smooth transition for the newly acquired colleagues and clients.
Flagstar shares were up 4.37 percent at $36.31 at the close Wednesday.
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