The Bank Slate

INSIGHTS INTO THE BANKING INDUSTRY

Citizens to buy Investors Bancorp in N.J. for $3.5B

Citizens Financial Group in Providence, R.I., has agreed to buy Investors Bancorp in Short Hills, N.J.

The $185.1 billion-asset Citizens said in a press release Wednesday that it will pay $3.5 billion in cash and stock for the $27 billion-asset Investors. The deal, which is expected to close by mid-2022, priced Investors at 130% of its tangible book value.

Investors has 154 branches, with 130 around New York City. It also has $22 billion of loans and $20 billion of deposits.

Citizens already has a pending purchase of branches from HSBC Holdings, while Investors is looking to buy eight branches from Berkshire Hills Bancorp.

The Investors acquisition “further strengthens our formidable franchise in the northeast, together adding roughly one million customers and boosting our near- and long-term growth potential,” Bruce Van Saun, Citizens’ chairman and CEO, said in the press release.

“We are confident in our ability to successfully integrate these acquisitions, and to over time deliver the same attractive offerings to customers and strong financial performance in the New York City metro region and New Jersey as we do in other major metro areas we serve,” Van Saun added.

Citizens said it expects the deal to be 6.4% accretive to its 2023 earnings per share. It should take a little more than two years for the company to earn back an estimated 2.6% dilution to its tangible book value per share.

Citizens plans to cut about 30% of Investors’ annual noninterest expenses, or $130 million. The company expects to incur $400 million of merger-related expenses. 

Kevin Cummings, Investors’ chairman and CEO, and Michele Siekerka, one of the company’s directors, are expected to join Citizens’ board.


Morgan Stanley and Sullivan & Cromwell advised Citizens. Keefe, Bruyette & Woods, Piper Sandler, Lazard and Luse Gorman advised Investors.

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