Eastern Bankshares buys insurance agency

Eastern Bankshares in Boston has acquired NorthBridge Insurance Agency in Concord, Mass.

The $16 billion-asset company did not disclose the price it paid.

The deal is Eastern’s third agency acquisition since it became a fully stock-owned company on Oct. 14. The company bought the Auburn Insurance Agency in Sudbury, Mass., in late October and Campbell, Flaherty and Ring Insurance Agency in Dorchester, Mass., in December.

Eastern has acquired 33 insurance agencies since 2002.

Eastern Insurance Group generated $94 million of revenue last year. Eastern stated in its 2020 annual report that its insurance operation contributed “the most significant portion of our noninterest income.”

Noninterest income comprised nearly a third of Eastern’s total revenue last year, Jake Civiello, an analyst at Janney Montgomery Scott, wrote in a recent client note.

The insurance unit offers commercial and personal insurance coverage to more than 75,000 individual and business clients. At the same time, Eastern Benefits Group has become one of the biggest employee benefits companies in New England.

Eastern raised about $1.6 billion in its initial public offering.

The IPO has raised expectations for potential banks deals that would put Eastern’s excess capital to work. CEO Bob Rivers has done little to dampen speculation, telling analysts during a Jan. 29 conference call that he was interested in buying bank and insurance agencies.

“We believe Eastern will be aggressive in supplementing organic growth with targeted acquisitions keeping a close eye on minimizing tangible book value dilution,” Civiello wrote in his note. “Eastern has been acquisitive in the past and the meaningful excess capital position from the conversion should be efficiently and profitably leveraged.”

Eastern, founded in 1818, was the nation’s oldest depositor-owned mutual bank prior to its IPO.

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