- Key insight: Banco Santander finalized its acquisition of Webster Financial on Thursday, marking the closure of the largest U.S. bank M&A deal to be announced this year.
- What's at stake: Santander is positioned to significantly increase its scale and profitability in the U.S., where it has been trying for years to be a larger retail and commercial bank.
- Forward look: Santander has set a goal to achieve a return on tangible equity of around 18% by 2028, which would be a large improvement from last year, when the metric was 10%.
Banco Santander completed the acquisition of Webster Financial on Thursday, wrapping up the largest U.S. bank merger or acquisition announced so far this year and supporting the Spanish banking giant's ongoing efforts to improve the scale and profitability of its stateside business.
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The deal, which was valued at $12.3 billion when it was announced, was finalized six-and-a-half months after the two parties said they would partner to create a $327 billion-asset bank with a branch network stretching from Pennsylvania to New Hampshire. Stamford, Connecticut-based Webster had long been on Santander's wish list as a way to expand its scale in the U.S., where Santander has been trying for several years to become a larger retail and commercial bank.
The acquisition will help Santander achieve its return on tangible equity target in the U.S. of "around 18%" by 2028, Santander said Thursday. That would be up considerably from 2025, when the bank reported a 10% return on tangible equity.
"This is a pivotal moment in Santander's long journey in the United States that underscores our confidence in the strength and opportunity in the U.S. market," Christiana Riley, CEO of Santander US, said Thursday in a press release. "By bringing together Santander and Webster, we are combining two organizations with shared values and strong customer relationships."
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The tie-up between Madrid-based Santander and Webster tops the list of bank M&A deals announced since the start of the year. Bank M&A was poised to accelerate in 2026 following a large pickup in activity in the back half of 2025, but the number of deal announcements slowed following the start of the U.S.-Iran war in late February. Analysts expect activity to pick up in the second half of the year, given the relative strength of bank stock prices and the favorable regulatory environment.
At certain points over the past six months, analysts wondered if Santander's bid to buy Webster could be in jeopardy, in light of President Trump's threats in March to halt trade with Spain. The Spanish government had refused to allow the U.S. military to use its bases to launch attacks against Iran. Last month, Trump made similar comments, but trade between the two NATO allies remains in place.
The Federal Reserve Board approved the deal earlier this month, following approvals from the Office of the Comptroller of the Currency and the European Central Bank. Webster shareholders approved the deal in May, according to a securities filing.
Santander is an outlier among European banks, most of which have retreated from the states in recent years due to stiff competition from U.S.-based banks.
Following the Webster acquisition, Riley remains Santander's U.S. country head, a role she has held since early 2025. John Ciulla, Webster's chairman and CEO, is now CEO of Santander Bank, N.A., while Luis Massiani, who was Webster's president and chief operating officer, is now the COO of Santander Holdings USA and Santander Bank, N.A. Massiani will also lead the integration of the two banks.
Webster's former headquarters in Stamford will become a corporate hub for Santander U.S., Santander said in the release. In addition to Santander's U.S. headquarters in Boston, the bank has corporate hubs in New York, Miami and Dallas. Its branch count is now more than 550, including about 195 former Webster branches, the majority of which are located in Connecticut and New York.
Santander's press release Thursday did not provide details about its integration timeline. However, Webster's brand and technology will remain in place "for at least another year," according to an article Thursday in the Hartford Business Journal. Riley told the publication that the two banks will combine under a single brand and technology platform by the end of 2027.
For now, customers of both Santander and Webster will be able to use one another's ATMs to access cash at no cost, Santander said in the release.
Webster was attractive to Santander because of its stable low-cost deposits from multiple sources, its dense branch network in Connecticut, where Santander had few branches, and its strong commercial loan portfolio, executives have said.
The combined bank has $185 billion in loans and $172 billion in deposits, based on balances as of Dec. 31, 2025, according to the release.
