Eastern Bank, the U.S.'s largest mutual savings bank, plans to go public, the Boston-based firm announced Thursday.
The bank, established in 1818, plans to raise $1.3 billion to $1.7 billion through an initial public offering (IPO) this year, according to a regulatory filing. The $12.3 billion-asset bank said it aims to sell more than 201 million shares at $10 apiece.
"As we anticipate the competitive landscape that will emerge after our economy recovers from the negative impacts of the Covid-19 pandemic, we believe the most significant systemic challenge we will face is the accelerating pace of technological change driven by ubiquitous digital adoption by both consumer and commercial banking customers," the bank said in filing. "The capital raised in the offering will allow us to increase our investments in new technologies to develop and implement an increasingly sophisticated array of banking and other financial services."
Eastern Bank has been planning its IPO for the past 11 months, the bank's chairman and CEO, Bob Rivers, told the Boston Business Journal.
Rivers cited the reliance on technology, which has accelerated amid the pandemic, as a primary reason for the IPO.
"It was clear to us that the ubiquitous nature of the cellphone, and its expanded capabilities, were ones that were going to take much more investment for us to continue to keep pace. We realized to have more resources, we need to be bigger," he said.
Eastern Bank was one of the first community banks to build its own innovation lab, and its status as a depositor-owned financial institution has enabled it to make significant tech investments in the past, according to American Banker.
Digital lending platform Numerated, which recently tailored its technology to the Paycheck Protection Program (PPP) to help banks expedite the loan application process, was spun off from Eastern Bank's innovation lab in 2017.
Eastern Bank said the IPO will also allow the institution to pursue mergers and acquisitions as it expects to see more industry consolidation amid the current recession.
The bank, which said it has nearly 90 branches, said it intends to pursue opportunities to acquire banks in its existing and contiguous markets that create "attractive financial returns."
"Our focus will primarily be on franchises that enhance our funding profile, product capabilities or geographic density, while maintaining an acceptable risk profile," the bank said in Thursday's filing.
Shares of Eastern Bank will trade on the Nasdaq Global Select Market under the symbol EBC, the bank said.