Dive Brief:
- Webster Financial will pay $350 million in cash to buy Ametros Financial, a custodian and administrator of medical funds from insurance claim settlements, the company announced Thursday.
- Ametros counts $804 million in deposits under custody, which will be transferred to Webster following the deal, which is expected to close in the first quarter of 2024.
- Ametros’s deposits have more than doubled in the past three years and are projected to grow at a compound annual rate of about 25% over the next five years.
Dive Insight:
The Ametros transaction marks the second acquisition of a deposit-gathering platform in just over a year for Webster.
The $70 billion-asset Connecticut-based bank, agreed last December to buy interLINK, a platform managing $9 billion in deposits. It bought health savings account administrator HSA Bank in 2015, and purchased Pearl River, New York-based Sterling Bancorp in a $5.1 billion deal that received regulatory approval in 2021.
“This acquisition closely aligns with our strategic focus on building a diverse and unique funding base,” Webster CEO John Ciulla said in a statement Thursday. “Ametros’ market position and value proposition for its clients and partners underpin a robust growth trajectory for this highly complementary business.”
Ametros's funds are managed by Long Ridge Equity Partners, a private equity firm specializing in financial and business technology.
Webster's chief operating officer, Luis Massiani, told American Banker the acquisition would serve three purposes.
“It's a fast-growing source of low-cost and long-duration deposits, provides new sources of noninterest income and enhances Webster's healthcare financial services expertise,” Massiani told the publication in an email. Webster's unique and differentiated funding base is ideal for providing credit to commercial and consumer clients, he added.
The third-quarter results showed that the consumer bank, which includes BrioDirect, which offers high-yield savings accounts and certificates of deposit, held 39% of Webster's total deposits or around $23.6 billion. The commercial bank held 32% of total deposits, while HSA Bank and interLINK had 14% and 9%, respectively. Webster's deposits saw an 11.7% increase year over year totaling, $60.3 billion at the end of September, according to American Banker.
