Customers Bancorp to keep BankMobile for at least two years
Customers Bancorp in Wyomissing, Pa., plans to keep its digital bank for the foreseeable future.
The $9.8 billion-asset company, which tried to spin off BankMobile last year, said in a press release Thursday that it intends to keep the business for two to three years. Customers will keep evaluating ways for BankMobile to take advantage of the small issuer exemption under the Durbin Amendment.
Customers also disclosed that it expects BankMobile to be profitable by the end of this year.
The company failed to spin off BankMobile last fall. A complex deal with Flagship Community Bank Clearwater, Fla., fell through due to complications with the regulatory process. Customers had been in talks with Flagship about the spinoff for more than a year.
BankMobile began testing its first white label partnership in late November. The partnership generated about 4,500 funded deposit accounts with more than $5 million in total deposits in one month. Customers said it expects account openings and deposit growth to accelerate later this year when the white label partner starts to market the account.
Demand deposits generated by BankMobile averaged $532 million in the fourth quarter, with an average cost of 0.14%.
Customers said its fourth-quarter profit fell by 17% from a year earlier, to $17.9 million, reflecting a decline in net interest income.
The company shed $790 million in assets during the quarter as part of an effort to remain below a regulatory threshold that would impose caps on interchange fees.
Customers said it plans to keep its assets flat this year, while focusing on improving margins, capital and profitability.
"Capital ratios will continue to build in 2019 as we retain earnings and the balance sheet remains flat," Jay Sidhu, Customers' chairman and CEO said in the release. "We continue to evaluate the best uses for our excess capital."