Pasadena-Headquartered CIT Bank to Acquire Mutual of Omaha Bank for $1 Billion

Published : Tuesday, August 13, 2019 | 5:25 AM

CIT Group Inc. and Mutual of Omaha today announced a definitive agreement for CIT’s Pasadena-based banking subsidiary, CIT Bank, N.A., to acquire Mutual’s savings bank subsidiary, Mutual of Omaha Bank, for a purchase price of $1 billion.

The purchase price will be comprised primarily of cash and up to $150 million of CIT common stock, the amount of which will be determined by CIT, according to an announcement released by CIT in New York City.

The transaction will diversify and enhance CIT’s funding profile with “stable, lower-cost deposits” from Mutual of Omaha Bank’s homeowner’s association (HOA) banking business.

In addition, CIT officials said it will advance CIT’s strategic plan, extend its commercial banking capabilities and enhance profitability.

According to CITY, the transaction includes $6.8 billion in deposits, $4.5 billion of which are HOA deposits from more than 31,000 community associations nationwide, and $2.3 billion of which are from commercial and consumer financial centers in key markets.

In addition, $8.3 billion of total assets, including $3.9 billion of middle-market commercial loans, are part of the transaction, which adds to CIT’s growing franchise, the bank said.

On a pro forma basis, CIT will have approximately $42.1 billion of total deposits and $58.9 billion of total assets.

CIT Chairwoman and Chief Executive Officer Ellen R. Alemany said, “Following our multi-year strategic transformation, we entered the next phase of our plan focused on thoughtful growth and value creation. This transaction squarely aligns to those goals by immediately enhancing our deposit and commercial banking capabilities and improving our profitability. This is a unique opportunity to accelerate our strategic plan through the addition of a market-leading HOA deposit franchise, a broader set of product and technology solutions and an expanded business footprint that complements CIT’s existing franchise.”

CIT Group Inc. (NYSE: CIT) is a financial holding company with over a century of experience, approximately $50 billion in assets as of June 30, 2019, and operates a principal bank subsidiary, CIT Bank, N.A. (Member FDIC, Equal Housing Lender).

The company’s commercial banking segment includes commercial financing, real estate financing, equipment financing, factoring and railcar financing. CIT’s consumer banking segment includes its national online bank, CIT Bank, and a Southern California branch bank, OneWest Bank.

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