Community Financial System to acquire seven Santander branches

Investing.com - Community Financial System (NYSE:CBU) announced it has entered a purchase and assumption agreement to acquire seven branches from Santander (BME:SAN) Bank in the Allentown, Pennsylvania area, according to Keefe, Bruyette & Woods.

The transaction involves CBU paying $48 million, representing an 8.0% deposit premium, while assuming $600 million in deposits and $33 million in loans. The company will also retain related wealth relationships associated with the acquired branches.

The deal is expected to close in the fourth quarter of 2025, pending regulatory approvals, and is projected to be slightly accretive to earnings, Keefe, Bruyette & Woods noted in its analysis.

Keefe, Bruyette & Woods maintained its Market Perform rating and $69.00 price target on Community Financial System stock, viewing the acquisition favorably as an efficient means for CBU to deepen its market share.

The acquisition strategically complements Community Financial System’s already underway 18-branch de novo expansion taking place throughout 2025, three of which are already planned for the Allentown area.

In other recent news, Community Bank System Inc . reported its first-quarter 2025 financial results, revealing an earnings per share (EPS) of $0.93, which exceeded analyst expectations of $0.91. However, the company’s revenue of $196.2 million fell slightly short of the anticipated $197.1 million. In a strategic move, Community Bank announced an agreement to acquire seven branches from Santander Bank in the Allentown, Pennsylvania area. This acquisition, which includes approximately $600 million in deposits and $33 million in loans, is expected to close in the fourth quarter of 2025, subject to regulatory approval.

The acquisition will expand Community Bank’s presence in the Greater Lehigh Valley, bringing its total retail locations in the area to 12. Despite the revenue miss, the company maintains a strong liquidity position and continues to expand its branch network. Analysts from firms such as Lazard (NYSE:LAZ) Frères & Co and Ambassador Financial Group have been involved in advising Community Bank on this expansion. Additionally, the company has projected mid-single-digit growth in its fee income businesses and expects a net interest margin expansion of 2-7 basis points per quarter. These developments underscore the company’s ongoing efforts to strengthen its market position and financial performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.