Santander to acquire Webster Bank in $12.3B deal
Stamford-based Webster Financial agrees to $12.3B acquisition by Spain's Banco Santander, creating sixth-largest U.S. regional bank with major Connecticut presence.
The transaction values Webster at approximately $65 per share, representing a 25% premium to the bank’s closing price Friday. Webster shareholders will receive a combination of cash and Santander stock, according to the companies’ joint announcement Monday.
Webster CEO John Ciulla will join Santander’s U.S. leadership team following the deal’s completion, expected in the fourth quarter pending regulatory approval. The combined entity will operate more than 650 branches across 10 states, with significant presence along the Metro-North corridor from Stamford to New Haven.
“This combination creates a formidable competitor in our core markets while maintaining our commitment to Connecticut communities,” Ciulla said during a conference call with analysts. Webster operates 156 branches in Connecticut, more than any other regional bank.
Santander’s U.S. operations, headquartered in Boston, reported $89 billion in assets at year-end, while Webster holds $75 billion. The merger creates the sixth-largest regional bank in the country by assets, according to S&P Global Market Intelligence data.
The deal comes as mid-sized banks face mounting pressure from rising interest rates and increased competition from larger rivals. Webster’s stock has declined 18% over the past year, while the KBW Regional Banking Index fell 12% during the same period.
Local business leaders expressed cautious optimism about the merger’s impact on Connecticut’s economy. “Webster has deep roots in Fairfield County’s business community,” said Joseph McGee, vice president of public policy at the Business Council of Fairfield County. “The key question is whether Santander maintains that local focus.”
Santander executives pledged to retain Webster’s Connecticut headquarters and preserve local decision-making authority for commercial lending. The Spanish bank’s U.S. division has pursued aggressive growth through acquisitions, purchasing Massachusetts-based Sovereign Bank in 2009.
Regulatory approval could take 12 to 18 months, during which both banks will operate independently. The Federal Reserve and Office of the Comptroller of the Currency must review the transaction, along with state banking regulators in Connecticut and other affected states.
Webster traces its Connecticut roots to 1935 and has grown through strategic acquisitions, including the 2021 purchase of Sterling Bancorp. The bank employs approximately 3,200 people statewide, with significant operations in Waterbury, New Haven, and Hartford beyond its Stamford headquarters.