Customers Bancorp, the parent company of Customers Bank, announced Wednesday (Mar. 8) the execution of a purchase and assumption agreement to sell the assets and liabilities of the BankMobile unit.
In a press release, the company said the sale includes all deposits, technology, intellectual property and customer accounts. Customers Bancorp is selling BankMobile to Flagship Community Bank for a total cash purchase price of $175 million. After accounting for all expenses, this transaction is expected to create approximately $100 million of pre-tax gain for Customers, the company said.
“Due to Durbin Amendment restrictions on debit card interchange fees, Customers believes it will be unable to profitably operate BankMobile once Customers’ consolidated assets exceed $10 billion,” stated Jay Sidhu, chairman and CEO of Customers Bancorp.
As a result Customers had previously said it would divest the unit and received offers from several institutions of different sizes. The board of directors concluded the Flagship deal was the best for Customers.
“Our Board of Directors, with the assistance of our advisors and investment bankers, studied a variety of strategic options available to Flagship. While Flagship continues to believe in the demand for a locally owned and managed community bank and will continue its model of local community banking through its two branches in Clearwater, we also recognize that digital banking is expanding and the acquisition of BankMobile provides us with an opportunity to meaningfully expand our digital banking footprint beyond our Florida markets,” said Frank Burke, chairman, president and CEO of Flagship.
The companies noted the deal is subject to the receipt of all necessary regulatory approvals, certain Flagship shareholder approvals, financing and other customary closing conditions and is expected to close in the third quarter of 2017.