Dive Brief:
- Wilmington, Delaware-based WSFS Financial agreed to pay $976.4 million in stock to buy Pennsylvania-based Bryn Mawr Trust, the companies said Wednesday in a press release.
- The deal — expected to close in the fourth quarter, pending regulator approval — would create a combined entity with $19.7 billion in assets and $43 billion under management. The deal would give WSFS control of about 7% of deposits in the Philadelphia region, more than any other locally based bank, The Philadelphia Inquirer reported, citing data from the Federal Deposit Insurance Corp. (FDIC).
- WSFS plans to offset $127 million in merger-related expenses by saving about $73 million in annual noninterest expenses, the bank said Wednesday. That would include closing about 30% of the combined bank's 130 locations and cutting about 250 "overlapping" jobs, WSFS CEO Rodger Levenson told The Inquirer. The bank, however, already has 150 open or expected new positions this year, Levenson said.
Dive Insight:
The acquisition is WSFS's ninth since 2010 and first since it bought Beneficial Bank — at that time the largest bank based in Philadelphia — in 2019. It "uniquely" positions WSFS "as the only locally headquartered bank with the size and scale to compete with the big guys," Levenson told the Inquirer.
Also crucial, however, is the type of asset Bryn Mawr gives WSFS. Although Bryn Mawr accounts for just $5.4 billion of the combined asset total, it would nearly double WSFS's wealth-management footprint, bringing in $19 billion in assets under management and giving the combined entity the sixth-largest wealth-management business among banks with less than $100 billion in assets, Levenson said.
"Combining with Bryn Mawr allows us to accelerate our long-term strategic objectives, including scale to continue to invest in our delivery and talent transformations," Levenson said in Wednesday's release. That indicates the bank intends to reinvest some of its cost savings into technology upgrades — a strategy it followed in 2019's Beneficial takeover, when it pledged to pour $32 million in saved expenses over five years into advancing its technology.
Upon closing, Bryn Mawr CEO Frank Leto will join WSFS's board of directors alongside two yet-to-be-named fellow Bryn Mawr board members.
"We strongly believe in the value creation by combining with WSFS and enhancing the strengths of our institutions. This is a sound decision," Leto said in Wednesday's release. "We are combining with WSFS because it is an established institution with deep roots in the region and the utmost focus on doing the right thing for our Clients."
WSFS also pledged to donate $2 million to its community foundation "to support underserved communities" as part of the deal.
