UMB to Acquire El Dorado for $506 Million, Expanding Branch Network West
Key Facts
UMB Financial announced a definitive agreement on October 27 to acquire El Dorado Savings Bank in a deal valued at about $506 million. Consideration consists of 52% cash and 48% stock, according to UMB’s filing with the U.S. Securities and Exchange Commission. The deal adds to the group’s presence in California and Nevada, with 31 branches in California and four in Nevada. UMB said its network will reach 227 branches in 15 states after the deal closes. Closing remains subject to regulatory and El Dorado shareholder approvals, and the company expects it to be completed in the first quarter of 2027.
The deal is based on a larger deposit base than loan portfolio at the target bank. El Dorado had about $2.4 billion in assets, $2.1 billion in deposits and $0.5 billion in loans as of September 30, 2026. In deal materials, UMB described the deposits as core consumer deposits that are diversified and low-cost, and said they would provide liquidity to support loan growth. The company estimated El Dorado’s loan-to-deposit ratio at about 24%. The balance gives UMB a local funding base in the areas it will enter through the acquisition, according to its presentation of the deal.
The terms of the consideration set out how the deal’s value will be divided between cash and stock for El Dorado shareholders. Under the agreement, the owner of each share in the bank will receive 13.553 shares of UMBF, along with $1,958.88 in cash. UMB expects former El Dorado shareholders collectively to own about 2% of the combined company after the deal closes. The boards of both companies approved the agreement, according to UMB’s quarterly filing. Shareholder and regulatory approvals, however, remain closing conditions that had not been completed at the time of the announcement.
The deal comes as UMB reported growth in its quarterly results and lending activity. Revenue was $772.4 million in the third quarter of 2026, up 13.9% from the same period in 2025. Net income available to common shareholders was $272.3 million, or $3.56 per diluted share. Average loans also rose 11.1% on an annualized quarterly basis to $41.7 billion. Commercial and industrial loan balances increased 21.5% on the same basis to $18.5 billion, according to the company’s results.
In its third-quarter results, UMB said gross loan production reached a record, putting the agreement in the context of an expanding banking portfolio. But Chief Executive Mariner Kemper pointed to risks that could weigh on activity, including persistent inflation, conflict in the Middle East and higher short- and long-term interest rates. He said these factors “could be headwinds.” He added that customer sentiment and demand for business investment remained strong across the company’s markets and business lines. This context combines UMB’s reported lending growth with economic risks it said could affect its operating environment.
El Dorado Chief Executive David O. Cook said the merger would allow the bank to offer more products and services and expand its support for communities. Systems conversion is scheduled to begin after closing, which UMB expects in late in the first quarter or early in the second quarter of 2027. El Dorado said it expects to operate in California as UMB Bank after the merger while continuing to serve customers under its current brand. An employee Q&A also said no branch or office closures were expected as part of the merger at the time of the announcement, citing the lack of geographic overlap between the networks. The company said support-function job reductions are expected between closing and the planned systems conversion in the second quarter of 2027.
UMB cited characteristics of El Dorado’s loan portfolio and deposits in its earnings call when explaining the deal. The bank’s total cost of deposits was 88 basis points in the third quarter, and 89% of deposits were insured. Average deposits per branch were estimated at about $60 million, and the average age of deposit accounts was 14 years, excluding certificates of deposit. The loans transferring to UMB consist mostly of consumer mortgages, with a loan-to-value ratio of 39% and an average loan of $138,000. UMB said it expects the deal to add modestly to earnings in 2027.