In banking, rankings—not math—make 31 + 36 equal 23. Banco Santander (the 31st largest U.S. bank) plans to acquire Webster Financial (the 36th largest). Combined, they would form the 23rd largest U.S. bank, with about $188 billion in assets,

The article also highlights broader trends in foreign ownership of U.S. banks, since Banco Santander is from Spain.

The final piece explains Global Systemically Important Banks (G‑SIBs), which must hold extra capital to absorb potential losses.

When Does 31 + 36 = 23?

Mathematically, obviously never:

(31 + 36 = 67). In banking, however, let’s see:

In February, Banco Santander, Madrid, Spain, parent of  5-Star Santander Bank N.A., Wilmington, DE (29950) announced it will acquire Webster Financial Corporation and its 5-Star Webster Bank N.A., Stamford, CT (18221). Based on year-end 2025 data, Santander is the 31st largest bank in the U.S.; Webster is the 36th largest.

Combing these two banks (31 + 36) will create the 23rd largest bank in the U.S. with $188 billion in assets. (The 23rd spot is currently occupied by 5-Star Ally Bank, UT (57803), a $184.6 billion asset bank.)

Shareholders of both companies have already approved the combination but both U.S. and E.U. regulators must approve this transaction as well. Assuming those approvals are granted, the parties expect the deal to be completed in the second half of this year.

If you have deposits at Webster Bank (which includes BrioDirect and HSA Bank) and at Santander (which also includes openbank.us), you will want to pay close attention. They will become one bank with singular deposit insurance once completed.

On page 5 of this week's Jumbo Rate News we have a list of U.S. banks that operate, at least partially, under a foreign umbrella. The majority have an intermediate U.S. Holding Company, but not all.

The first bank listed, for example, is 5-Star Idaho First Bank, McCall, ID (58095). Idaho First Bank’s parent is Peak Bancorp, Inc., also of McCall, ID. Peak Bancorp’s parent is Bawag Group, AG, of Vienna, Austria.

Santander Bank and Idaho First Bank are two of a handful of banks with upper tier ownership in Europe. The U.S. bank affiliates have close to $500 billion in assets combined (less than 2% of industry assets).

U.S. banks with ownership ties to Japan have assets totaling $525 billion, or 2.1% of the total. These banks include 4-Star Morgan Stanley Private Bank N.A., Purchase, NY (34221) and its affiliate 4-Star Morgan Stanley Bank N.A., Salt Lake City, UT (32992).

The Morgan Stanley Financial Holding Company in New York City is the direct parent of both of these banks. Morgan Stanley FHC is owned by over 2,500 institutional investors and shareholders worldwide. Its largest stockholder, Mitsubishi UFJ Financial Group Inc. of Japan, reportedly controls roughly 24% of the New York based firm.

You will note an asterisk next to the Morgan Stanley Banks on page 5 (as well as others). The asterisk denotes that the foreign ownership listed may not meet all definitions of “control” of the bank. Other significant investors in Morgan Stanley include heavy hitters like State Street Corp., JPMorgan Chase and Bank of America and others.

Institutions from our neighbor to the north are the biggest investors in U.S. banks. They control close to $1 trillion of U.S. bank total $25.3 trillion in assets. Canadian firms also control two of our nation’s largest 20 banks by asset size. They are #12 4-Star TD Bank, N.A., Wilmington, DE (18409) and #16 5-Star BMO Bank, N.A., Chicago, IL (16571).

Toronto-Dominion Bank, Toronto, Canada is the top tier parent of the intermediate holding company, TD Group US Holdings LLC, Mount Laurel, NJ. TD Group US Holdings is the parent of our 12th largest bank (noted above) with $346.2 billion in assets as well as 4-Star TD Bank USA, N.A., Wilmington, DE (33947 #66 by assets with $34.6 billion).

TD Bank has looked at more expansion in the U.S. In fact, about three years ago, (May 2023) a bid to purchase 5-Star First Horizon Bank, Memphis, TN (4977) was shot down by regulators. We don’t expect that hiccup to deter it forever, but as for today, TD Bank still operates through 1,000+ branch offices in 16 states. Its affiliate, TD Bank USA, has just one office in Delaware.

Just a few months before the brakes were put on TD’s Tennessee expansion plans, BMO Financial Corp., Chicago, IL, the intermediate (U.S.) holding company of Bank of Montreal, acquired a $92 billion asset U.S. bank (Bank of the West, CA) and folded it into 5-Star BMO Bank, Chicago, IL (16571). BMO Bank now operates 993 branch offices in 23 states.

Finally, you may be wondering what the highlighting is all about on page 5. The highlighted institutions have been designated as Global Systemically Important Banks (or G-SIBs). G-SIBs are required to hold additional common equity equal to 1% to 3.5% of risk-weighted assets, to absorb potential losses.

There are currently 29 G-SIBs across the globe. In addition to those highlighted on page 5, these US banks are designated G-SIBs:

Bank of America (2.0%)

Citigroup (2.0%)

Bank of New York Mellon (1.0%)

Goldman Sachs (1.5%)

JP Morgan Chase (2.5%)

State Street (1.0%)

Wells Fargo (1.0%)

JP Morgan Chase will be the only G-SIB required to keep 2.5% of additional common equity loss absorption in 2027. There is only one higher level (3.5%) which is empty for now. These levels are reevaluated annually by the Basel committee to ensure these banks are able to withstand large sudden losses. (Can you say too big to fail?)