While Citizens Financial Group Inc. sees stronger organic growth opportunities than peers, the company remains on the pursuit for acquisitions after announcing plans to acquire the East Coast branches and national online deposit business of HSBC Bank USA NA.
In the latest Street Talk podcast, Citizens Financial Group Chairman and CEO Bruce Van Saun discussed the HSBC deal, the company’s appetite for future acquisitions, balancing physical branches against digital offerings and the outlook for credit quality and loan growth.
Van Saun said the company has greater exposure to consumer lending, allowing it to produce stronger loan growth than peers. Citizens grew loans by 4.8% in 2020, well above the 1.3% median growth reported by the top 20 banks in the industry. The company's loans contracted slightly in the first quarter of 2021 but the decline was not as great as experienced by other large banks.
Van Saun said commercial line utilization rates are currently near all-time lows at 31%, but the company believes that metric has hit a trough and sees signs of it increasing in the second half of 2021. The executive further noted that the loan pipeline associated with acquisitions was quite tepid in 2020 and the first quarter of 2021, but pipelines are now back to pre-pandemic levels.
Street Talk – Episode 80: Citizens still on the hunt for deals post HSBC branch deal
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