KeyCorp (NYSE: KEY) strengthens its presence in online lending with the acquisition of the digital business of a New York City company that operates a fast-growing student loan refinancing platform.
KeyBank’s parent company announced Thursday, January 17, that it has agreed to purchase Laurel Road Bank’s digital lending operations. The three physical bank branches on Laurel Road in Southeast Connecticut are not part of the deal, the terms of which were not disclosed.
The acquisition is subject to customary closing conditions, including regulatory approvals. About 140 Laurel Road employees will join Key when the deal is finalized. These employees will continue to be based in New York, Connecticut and California.
In a press release, Key said the acquisition “will enhance its digital capabilities with cutting-edge customer-centric technology and leverage Laurel Road’s proven ability to attract and serve millennial business customers.
The Laurel Road student loan refinancing platform was launched in 2013 “and has grown rapidly, totaling over $ 4 billion in loans to date,” Key said in the press release. Last year, Key said, Laurel Road introduced an online platform for mortgages that uses the same technology.
Key said in the statement that Laurel Road “has leveraged its differentiated technology to build a solid reputation for delivering high quality customer experiences and solutions to targeted customer segments, such as healthcare professionals. health, lawyers and graduate students “. He added that Laurel Road “has created a large network of Affinity Partners through which it is a preferred supplier of its products,” a platform that “includes partners from trade associations, membership groups and employers and closely aligns with Key’s approach to strategic partnerships.
Chris Gorman, vice president and president of banking at Key, said in a statement that the company “is focused on building a targeted scale versus discrete customer segments through separate platforms. The model. of Laurel Road’s focus on senior degree professionals is not only consistent with Key’s approach, but also complements our focus on specific sectors more broadly. ”
Laurel Road Founder and Chairman Gary Lieberman added, “We couldn’t have found a better strategic partner to help Laurel Road take it to the next level and continue our mission of serving Millennial customers with technology that brings them to the next level. meet where they are in their financial journey. . “
CTPost.com reported As of September 30, 2018, Laurel Road had deposits of $ 515 million, according to the FDIC. The company lost $ 3.6 million in the third quarter of 2018, reporting bank equity of $ 67 million at the end of September.
Key had assets of approximately $ 138.8 billion as of September 30.