Valley National Bancorp will acquire Leumi, the U.S. subsidiary of Bank Leumi Le-Israel B.M., and parent company of Bank Leumi USA, in a deal with an estimated value of $1.1 million, the companies announced on Thursday (Sept. 23).
The banks will merge to become the 29th-largest publicly traded U.S. bank, according to the announcement.
With the merger, Valley’s commercial product offerings will be improved, and its technology and venture capital banking business will be broadened, while Leumi will bolster its exposure in the U.S. banking market, according to the announcement.
Together, the banks have total assets of nearly $50 billion.
The transaction is expected to account for roughly 7% of Valley’s 2023 earnings on a fully phased in basis, according to the release.
Under the terms of the merger agreement, Leumi shareholders will receive 3.8025 shares of Valley common stock and $5.08 in cash for each share of Leumi common stock they own. Once the merger is finalized, Bank Leumi will own more than 14% of Valley’s common stock.
The Valley National and Bank Leumi merger are among the latest bank acquisitions and consolidations. Last month, Minnwest Bank and Roundbank announced that the financial institutions had signed an agreement to merge, according to PYMNTS. Family-owned Minnwest Bank has $2.27 billion in assets, while Roundbank has $385 million in assets.
In July, United Community Banks and Reliant Bancorp announced a merger via an estimated $517 million all-stock transaction, according to PYMNTS.
U.S. bank mergers and acquisitions seemingly began to recover from the pandemic-fueled downturn earlier this year, according to PYMNTS. April marked the best month for bank mergers and acquisitions since the pandemic took hold. In all, 19 deals were announced in that month alone. By May, the number of deal acquisitions had reached 53, as compared to 43 for the same time period in 2020.