Huntington Bancshares in Columbus, Ohio, has agreed to buy the investment banking firm Capstone Partners — a move that is expected to boost fee income and middle-market commercial lending at the regional bank.
The financial terms of the deal, announced Tuesday, were not disclosed.
Capstone’s advisory business in particular could fuel Hutington’s noninterest income, which has already been on the rise. Huntington reported a 26% year-over-year increase in fee income to $515 million in the fourth quarter. Its capital markets business was one of the main drivers, producing 38% growth in fee income over the same period.
The Capstone deal “accelerates” the bank’s capital markets offerings to middle-market clients, Huntington said.
Capstone’s specialty in serving midsize companies should complement a commercial lending unit that had already been tapping into that same market segment, Scott Kleinman, co‐president of Huntington’s commercial banking unit, said in a press release.
“The combination of Huntington’s brand and capabilities alongside a premier middle-market investment banking franchise with unique industry insights creates a differentiating experience for our clients,” Kleinman said.
Capstone has two main bases in Boston and Denver along with offices in 12 other cities, including Chicago, Dallas, Detroit, Los Angeles, New York and Philadelphia. The pairing with Huntington would offer Capstone clients new services in mergers and acquisitions, capital and financial advisory, specialty situations and restructuring.
“Our combined capabilities will enhance Capstone’s full suite of products and services to private business owners and financial sponsors,” Capstone founder and CEO John Ferrara said in the release.
