In a recent move, First Citizens Bancshares, a North Carolina-based bank, has announced its acquisition of Run on Lender (RoL), a California-based fintech lender that specializes in small business loans. This acquisition comes just months after Silicon Valley Bank (SVB) also announced its acquisition of the fintech lender, marking an important shift in the banking industry.
The acquisition of RoL by First Citizens is a strategic move that allows the bank to expand its footprint in the fintech lending space. RoL has a strong reputation for providing loans to small businesses, and its technology-based approach to lending makes it a natural fit for a bank looking to enhance its digital capabilities. With this acquisition, First Citizens can tap into RoL’s expertise in digital lending and expand its offerings to small businesses.
Lender assumes $56 billion in deposits, $72 billion in loans.
The acquisition also highlights a growing trend in the banking industry. As traditional banks look to compete with fintech lenders, many are turning to acquisitions as a way to enhance their digital capabilities and expand their reach. This trend has been particularly prevalent in the small business lending space, where fintech lenders have gained significant market share in recent years.
While the acquisition of RoL by First Citizens is a positive move for the bank, it also raises questions about the future of fintech lending. With traditional banks entering the space through acquisitions, it remains to be seen how fintech lenders will be able to compete. While fintech lenders have gained significant market share in recent years, their ability to compete with larger banks on a global scale remains to be seen.
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Another important consideration is how this acquisition will impact small businesses. As traditional banks expand their offerings in the fintech lending space, it could lead to increased competition and potentially lower rates for borrowers. However, it could also lead to a reduction in innovation as larger banks prioritize profitability over experimentation and risk-taking.
The acquisition of Run on Lender by First Citizens Bancshares is a significant move in the banking industry and highlights the growing trend of traditional banks acquiring fintech lenders to enhance their digital capabilities. While this move is positive for First Citizens, it raises important questions about the future of fintech lending and the impact on small businesses. It remains to be seen how fintech lenders will be able to compete with larger banks in the long term, and how this trend will impact the broader banking industry.