Santander completes Webster Financial purchase to expand US balance sheet to $335B

Completion of the acquisition

Banco Santander finalized its acquisition of Connecticut-based Webster Financial on 20 August 2026, notifying Spain's National Securities Market Commission (CNMV) before markets opened. The transaction, initially announced in early February 2026, closed after Santander secured the final required regulatory authorizations. S&P Dow Jones planned to remove Webster from the S&P MidCap 400 index prior to Thursday trading, replacing it with Sun Communities. Following the market open in Madrid, Santander shares fell 0.8%.

Financial terms and balance sheet expansion

Santander paid between $12.5 billion and $12.7 billion (reported between €10.3 billion and €10.9 billion depending on exchange rates and valuation dates) for Webster. The deal terms provided Webster shareholders with $48.75 in cash and 2.0548 Santander shares for each share held. Overall, the consideration was structured as 65% cash and 35% newly issued Santander equity. To fund the equity portion, Santander issued over 329.8 million new shares, representing 2.2455% of pre-increase capital and 2.1962% post-increase, with the cash value of the capital expansion reaching €3,558.91 million.

Webster brings $86 billion in assets and approximately 200 branches across Connecticut, New York, Rhode Island, and Massachusetts, alongside a health savings account (HSA) administration business. The addition expands Santander's total US balance sheet to $335.3 billion (around €290 billion), a 33% increase. The acquisition represents 4% of total group assets.

Regulatory approvals and political scrutiny

The transaction concluded in under seven months following a sequence of regulatory green lights. Webster shareholders voted to approve the integration in late May 2026. The US Office of the Comptroller of the Currency (OCC) granted approval on 12 June 2026, followed by the European Central Bank on 21 July 2026. The US Federal Reserve, led by Kevin Warsh following the pre-summer departure of Jerome Powell, granted clearance on 5 August 2026.

The Federal Reserve approval arrived despite opposition from Republican senators Bernie Moreno and Tim Sheehy, who urged regulators to block the acquisition by arguing that Spain has not always been a reliable ally of the United States.

Integration and long-term targets

Most of Webster's operations will fold directly into Santander Bank, the group's US banking subsidiary. Teams from both banks have worked on integration planning since May 2026. Santander targets $800 million (approximately €700 million) in annual cost synergies alongside revenue synergies across private banking and corporate and investment banking (CIB). For the US perimeter, Santander projects a return on tangible equity (RoTE) of approximately 18% and a return on invested capital near 15% by 2028, with an earnings per share increase between 7% and 8%. The deal follows Santander's completion of its €3.3 billion purchase of British lender TSB from Banco Sabadell.

Ana Botín outlined the strategic intent behind the combination.

Santander US and Webster fit together perfectly. Together, with the support of Santander's global platforms, technology, and expertise, we will create a stronger bank with the scale required to offer better service to our customers and the communities in which we operate. This combination will strengthen our position in one of the most attractive banking markets in the world and places us in a privileged position to build one of the top-performing banks among our peers in the United States.