Western Alliance to acquire AmeriHome Mortgage for $1bn

Western Alliance Bancorporation has agreed to acquire Aris Mortgage Holding Company, the parent company of AmeriHome Mortgage Company, for $1bn.

Based in Thousand Oaks, California, AmeriHome Mortgage is a residential mortgage acquirer and servicer.

The company is said to have a B2B approach to the mortgage ecosystem via its relationships with more than 700 independent correspondent mortgage originator clients. These include independent mortgage bankers, community, and regional banks, and also credit unions of all sizes.

AmeriHome Mortgage is said to be the third largest correspondent mortgage acquirer in the US, buying nearly $65 billion in conventional conforming and government insured originations last year from its network of independent mortgage originators.

As of 31 December 2020, AmeriHome Mortgage managed a $99 billion mortgage servicing portfolio.

For Western Alliance Bancorporation, the acquisition of AmeriHome expands its national commercial businesses with a national mortgage franchise that is complementary and brings low risk.

The deal also considerably boosts the contribution from non-interest income sources for Western Alliance Bancorporation.

Western Alliance to acquire AmeriHome Mortgage for $1bn. Photo courtesy of Tumisu from Pixabay.

Ken Vecchione – President and CEO of Western Alliance Bancorporation said: “Acquiring this differentiated, high-performing mortgage platform provides a powerful growth engine and expands mortgage offerings to existing clients that give us flexible levers to drive consistent returns throughout market cycles. AmeriHome’s effective business model and exceptional leadership team will leverage Western Alliance’s liquidity and capital strength, market reach, complementary businesses and commercial customers.

“This move meaningfully enhances our EPS baseline and growth, diversifies our revenue mix, and mitigates business cycle volatility with a firm that augments our commercial-focused portfolio.”

Post-acquisition, AmeriHome Mortgage will retain its brand and will continue to be steered by its current president and CEO Jim Furash. It will become a subsidiary of Western Alliance Bancorporation’s banking subsidiary Western Alliance Bank.

Jim Furash said: “Joining Western Alliance Bank is a terrific opportunity to accelerate our own strategic objectives and pathway to growth, with an outstanding partner we know very well.

“AmeriHome’s successful results and unique business model proved to be highly attractive for Western Alliance Bank, which has a history of growing by adding specialized financing groups that excel through differentiated B2B expertise and strong client service. It’s a great match.”

The deal, which is subject to customary closing terms and conditions, is expected to be wrapped up in Q2 2021.