Photo by James Sanna | Banker & Tradesman Staff
The first of several acquisitions involving Boston-area banks is now complete, with Boston Private closing its sale to SVB Financial Group, the parent company of California-based Silicon Valley Bank.
Valued at approximately $900 million, the transaction closed this morning, six months after the $140 billion-asset SVB announced on Jan. 4 that it planned to acquire Boston Private, which has about $10 billion in assets. For each share of common stock, Boston Private shareholders received 0.0228 shares of SVB common stock and $2.10 in cash.
Boston Private CEO Anthony DeChellis is now CEO of SVB Private Banking and Wealth Management, with Yvette Butler as president. Butler was previously head of SVB’s private bank, wealth advisory and wine.
In a letter to customers posted on Boston Private’s website, DeChellis said Boston Private’s approach to personal banking and wealth would not change.
“Together, SVB and Boston Private are well positioned to meet and exceed your expectations of service and deliver the understanding, guidance and solutions needed to help build your wealth and expand opportunities for generations to come,” he said.
Two Boston Private executives will join DeChellis’ senior management team. Jim Brown, who has been leading Boston Private’s commercial banking group nationally, will continue with that role as head of commercial specialty. John Longley, who is based in San Francisco and president of Boston Private’s Western region, is now head of private bank, wealth, trust and wine.
The bank has retained the Boston Private name and added “An SVB Company” to its logo.
“Our Boston Private advisors and support teams will not change, and they will continue to provide the level of personalized service and expertise you have come to expect from Boston Private,” DeChellis said in the letter.
SVB said in January that it saw an opportunity in acquiring Boston Private to expand its position with current commercial clients by $400 billion, including about $250 billion in wealth and $150 billion in lending. Greg Becker, CEO of SVB Financial Group and Silicon Valley Bank, said in January that Boston Private’s technology, products and expertise would contribute to this growth.
In a separate letter this morning, Butler said SVB Private Bank clients would get access to a new wealth platform in the coming months. She added that SVB expects to offer some new products and services later this year and in early 2022. The integration of the two firms would take time, she said, with the majority of the work completed in 12 to 18 months.
SVB’s acquisition of Boston Private faced challenges from the outset. One of Boston Private’s shareholders, HoldCo Asset Management, had argued that the agreement between Boston Private and SVB came after a “non-existent sales process,” contending that Boston Private did not pursue other possible acquisition partners. The asset manager had also called the valuation price unacceptable.
Boston Private was aggressive in refuting HoldCo’s claims. The bank initially delayed the shareholder vote on the deal in order to solicit more proxies and give shareholders more time to consider the first quarter earnings for both Boston Private and SVB. Boston Private’s shareholders ended up approving the deal on May 4. The Federal Reserve approved the transaction in June.
The deal also comes with a $11.2 billion community benefits plan. The plan includes expanded participation in Massachusetts Housing Partnership’s ONE Mortgage and the City of Boston’s ONE+Boston first-time homebuyer mortgage programs.
Boston Private has 10 branches in Massachusetts and 11 in California, as well as wealth offices in South Florida. Boston Private has filed plans with the Massachusetts Division of Banks to close two of those branches, one at 800 Boylston St. in Boston and another in Lexington. Boston Private has also requested permission to move its 500 Boylston St. branch to 450 Boylston St.
This is the first of several bank mergers expected in Massachusetts this year. Other pending deals include Eastern Bank’s acquisition of Century Bank and Rockland Trust’s acquisition of East Boston Savings Bank. Connecticut-based People’s United Bank, which has branches throughout Massachusetts, is being acquired by Buffalo-based M&T Bank. Another Connecticut bank with Massachusetts branches, Webster Bank, is working on a merger-of-equals with New York-based Sterling National Bank.
