UMB Financial to buy Heartland Financial in $2bn deal

UMB Financial Corporation said on Monday that it has agreed to buy rival Heartland Financial USA in a $2bn all-share deal.

Heartland shareholders will receive a fixed exchange ratio of 0.55 shares of UMB common stock for each share of theirs, valuing the shares at $45.74 each based on UMB’s closing price on 26 April.

Founded in 1981, Heartland is headquartered in Denver and had $19.4bn in assets, $16.2bn in total deposits and $12.1bn in total loans, as of March 31, 2024.

UMB said the combination will create "a leading, regional banking powerhouse" spanning a 13-state branch footprint, adding California, Minnesota, New Mexico, Iowa and Wisconsin to UMB’s existing eight-state footprint, which includes Missouri, Illinois, Colorado, Kansas, Oklahoma, Nebraska, Arizona and Texas.

UMB chairman and chief executive Mariner Kemper said: "This is a historic and exciting milestone for our company.

"While we have maintained an outstanding pace of organic growth during the past decade, this compelling combination with HTLF marks a truly momentous expansion of all our core services in both existing and new markets. This synergy, along with a like-minded culture and customer approach, is an ideal fit for our business model, our credit and risk profiles, and our associates, customers and communities."

Following the transaction, UMB will have $64.5bn in assets, elevating it to the top 5% of the 616 publicly-traded banks in the US. The deal will increase its private wealth management’s assets under management/assets under administration by 31% and nearly double its retail deposit base.

It will also add 107 branches and 237 ATMs to UMB’s 90 branches and 238 ATMs.