Troy, Mich.-based Flagstar Bank is acquiring 52 Wells Fargo Bank branches in three states _ including 14 branches in Michigan's Upper Peninsula.
The beleaguered Wells Fargo announced Tuesday that it is leaving the retail banking business in Indiana, Michigan and Ohio. Four Wisconsin branches are part of the sale to Flagstar; Wells Fargo will have 48 branches remaining in Wisconsin once the sale closes.
The Michigan branches include locations in Marquette, Escanaba, Menominee, Munising, Houghton and Ishpeming.
After the deal is completed, the branches will be re-branded as Flagstar locations. The official transition is expect to be completed late in 2018, pending regulatory approval.
"Being able to increase our presence in the Midwest market _ a geography we know well and find very attractive _ is a terrific opportunity for us," said Alessandro DiNello, president and chief executive officer of Flagstar Bancorp in a statement.
"This transaction significantly expands our banking footprint, more than doubling our customer base," he said.
The transaction also allows Flagstar to transform its balance sheet _ moving funding from wholesale borrowings to core deposits _ which will make the bank's funding model more efficient and less sensitive to rising interest rates.
The agreement involves approximately $2.3 billion in deposits and $130 million in loans, along with certain related assets.
At closing, Flagstar expects to have 151 branches in the Midwest and eight in California. The transaction brings liquidity that Flagstar can use to repay short-term Federal Home Loan Bank advances.
Financial terms were not disclosed. Almost 500 employees will be get job offers from Flagstar.
Wells Fargo will maintain some commercial lending, wealth management, retail brokerage and home lending operations in the four states.
