The insurance industry is slowly backing out of the retail banking business, according to a report released Tuesday by SNL Financial, and a series of upcoming M&A deals stands to further shake up the industry.
According to the list assembled by SNL, USAA Federal Savings Bank, controlled by USAA, remains the largest insurer-owned bank in the country with more than $65 billion in total assets, followed by State Farm Bank FSB at $17 billion and Mutual of Omaha Bank at nearly $7 billion.
But Mutual of Omaha is in the midst of a reorganization that might threaten its place on that list. It will be selling off five of its branches in Colorado to focus its operations in the state at one "multifaced" location south of Denver.
"Our focus is on optimizing our physical presence in the markets in which we do business," bank spokesman Jim Nolan told SNL. "Mutual of Omaha Bank was formed in 2007 and much of its initial growth was through acquisition. As a result, we acquired branches in locations that don't necessarily align with our strategy as in the case of the Colorado Front Range branches. As the optimization process continues, we may see changes in our network of physical locations but we will continue to have a brick-and-mortar presence in our key markets."
New Jersey Manufacturers Insurance Co. is going even further, SNL said, and plans to voluntarily dissolve NJM Bank FSB once its loan portfolio has been sold off and its deposits transferred to other banks.
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