Sterling Bancorp in Montebello, N.Y., has agreed to buy two commercial lending businesses from Woodforest National Bank in The Woodlands, Texas.
The $30.4 billion-asset company said in a press release Wednesday that it will buy Woodforest’s asset-based and equipment finance businesses in a deal expected to close in the first quarter. Sterling did not disclose the price it will pay.
The deal includes $339 million in asset-based loans and $165 million in equipment finance loans, plus “significant origination capabilities in the Midwest and Southwest,” Jack Kopnisky, Sterling’s president and CEO, said in the release. Sterling had $812 million in asset-based loans and $1.2 billion in equipment-finance loans on its books on Dec. 31.
The acquisition “is consistent with our strategy of accelerating the transition of our balance sheet to a more diversified and higher-yielding commercial loan mix and will augment strong organic origination volumes that we anticipate in our commercial businesses in 2019,” Kopnisky added.
Sterling said the acquisition should add about $3 million to annual operating expenses.
Sterling has turned to acquisitions to diversify its operations. In April, the company bought Advantage Funding Management, a Lake Success, N.Y., equipment finance lender, and a $457 million-asset portfolio, from Australia’s Macquarie Bank.
The announcement came a week after the $5.8 billion-asset Woodforest disclosed that Cathy Nash, who led an expansion into big-ticket and middle-market commercial lending, had stepped down as president and CEO.
Woodforest tapped James Dreibelbis to succeed Nash.
In a separate release, Sterling said it earned $112.5 million in the fourth quarter. A year earlier, Sterling reported a loss of $35.3 million, largely due to the impact of tax reform legislation.
Sterling said it expects the Woodforest deal, combined with the planned sale of $1.6 billion of residential mortgage loans acquired along with Astoria Financial in October 2017, to add 20 basis points to its net interest margin. The margin was 3.57% on Dec. 31.