Citizens Financial Group inks $511m purchase deal for Franklin American

The company expects to break into the top of 15 of bank-owned residential mortgage servicing and origination platforms

Citizens Financial Group inks $511m purchase deal for Franklin American

Citizens Financial Group has announced that it is acquiring the assets of Franklin American Mortgage, a Franklin, Tenn.-based mortgage servicing and origination firm, in a deal valued at $511 million in cash.

The transaction is expected to close in the third quarter, subject to customary closing terms and conditions and regulatory approval.

Citizens expects that upon closing, the combined operations will become a top-15 bank-owned, residential mortgage servicing and origination platform. The company also expects to expand its existing off-balance sheet portfolio from $20.2 billion to approximately $61.6 billion, with a total portfolio of approximately $78.9 billion, including Citizen’s existing on-balance sheet mortgage portfolio.

Additionally, the deal would add about 200,000 servicing households, more than 600 correspondent relationships, and more than 1,000 wholesale-broker relationships.

“This transaction takes our mortgage business to the next level, expanding our reach and adding immediate scale in servicing as well as innovative correspondent and wholesale solutions,” said Brad Conner, Citizens vice chairman and head of consumer banking. “Franklin American Mortgage’s strong history of excellence in customer service is a great cultural fit with our organization and we are excited to welcome a new group of colleagues to Citizens.”

Eric Schuppenhauer, current president of home mortgage at Citizens, will lead the combined mortgage business. Upon closing, Scott Tansil will lead the acquired correspondent and wholesale origination businesses. Tansil is currently CFO and COO of Franklin American Mortgage.

Franklin American Mortgage has approximately 900 employees, and Citizens expects to maintain a significant presence in Tennessee and Texas associated with the expanded distribution platform of the combined business. Dan Crockett, owner, president, and CEO of Franklin American Mortgage, will remain involved in the business in an advisory role with Citizens Home Mortgage.