Santander Targets Top-10 US Retail Banks with $12.2bn Webster Deal

By Jesús Aguado and Arasu Kannagi Basil

Spanish banking giant Santander SAN.MC has announced a landmark $12.2 billion acquisition of US regional lender Webster Financial WBS.N, a move designed to place the bank among the ten largest retail and commercial banks in the United States by assets. The deal, confirmed on Tuesday, marks a decisive step in Santander’s long-term US expansion strategy under the leadership of Ana Botín.

Unlike many European rivals that have scaled back or sold off US operations over the past decade, Santander has consistently prioritised growth in the American market. This acquisition will propel the combined US balance sheet to approximately $327 billion in assets, making Santander a significant player in both retail and commercial banking, particularly in auto lending, where it already holds a major market share.

The offer values Webster shares at $48.75 in cash plus 2.0548 Santander shares per Webster share. Botín emphasised that the bank does not intend to raise its offer. Regulatory approval is anticipated, with the transaction expected to close in the second half of 2026. The merger is projected to deliver around $800 million in cost synergies, representing roughly 19% of the combined cost base.

US-listed Santander shares closed down 6.4% at $12.23 following the announcement.

Key Deal and Financial Details

Botín stated the acquisition will enhance Santander’s scale and profitability in the US while reducing funding costs. She also confirmed that no further acquisitions are planned over the next three years. The deal follows a trend of increased M&A activity between Wall Street banks and large regional lenders, boosted by regulatory expectations under the current US administration.

Santander, which entered the US market in 2005 via the Sovereign Bank acquisition, has recently strengthened its investment banking operations, recruiting over 100 former employees of the collapsed Credit Suisse.

Record 2025 Performance

The announcement coincided with Santander reporting a record net profit of €14.1 billion for 2025, up 12% from the previous year and exceeding analyst expectations of €13.77 billion. Fourth-quarter net income rose 15% year-on-year to €3.76 billion, above forecasts of €3.44 billion. The group’s ROTE, after AT1 instruments, reached 16.3%, slightly below the year-end target of 16.5%.

Loan revenue in 2025—defined as net interest income minus deposit costs—declined 2.8% to €45.35 billion, marginally exceeding analyst forecasts of €45.2 billion. Santander projects continued net profit growth in 2026 and expects increases of 14–16% by 2027 in constant euros, excluding proceeds from planned divestments in Poland, the UK TSB unit, or Webster.

Advisers to Santander on the transaction include Centerview Partners, Goldman Sachs, and Bank of America.