Enova International to Acquire Grasshopper Bank for $369 Million
Dive Brief:
Fintech Enova International has announced its plans to purchase Grasshopper Bancorp and its digital bank subsidiary, Grasshopper Bank, for $369 million in cash and stock. This strategic move aims to combine Enova’s online lending platform with Grasshopper’s national bank charter and deposit-gathering capabilities, providing access to a wider range of consumers and small businesses who have historically been underserved by traditional banks.
Dive Insight:
Enova, a nonbank online lender, has a strong track record of providing loans to consumers and small businesses, totaling $65 billion since 2004. The acquisition of Grasshopper Bank represents a significant milestone in Enova’s journey towards obtaining a bank charter, a goal the company has been pursuing for several years.
Grasshopper Bank, established in 2019 and headquartered in New York City, boasts assets totaling $1.4 billion and offers a range of banking services to businesses and consumers. The merger with Enova is expected to streamline operations and enhance product offerings, enabling both companies to better serve their clients.
The deal will see Enova shareholders holding a majority stake in the combined entity, with Grasshopper investors owning a minority share. Key leadership changes are also on the horizon, with Steve Cunningham set to become the CEO of both Enova and Grasshopper Bank, while Mike Butler will assume the role of president.
From a regulatory perspective, the acquisition will see Enova become a Fed-regulated bank holding company, while Grasshopper will retain its national bank charter. This move is expected to simplify the licensing process for fintech companies, providing a more streamlined pathway to offering banking services.
The transaction is projected to yield significant accretion to adjusted earnings per share, with Enova reporting strong financial performance in the first nine months of 2025. The deal’s price-to-tangible book value ratio stands at 2.54, indicating a favorable valuation for both parties involved.
Overall, the Enova-Grasshopper Bank acquisition signals a new chapter in the evolution of the fintech industry, with a renewed focus on bridging the gap between traditional banking and digital finance. The synergies between the two companies are expected to drive growth and innovation in the financial services sector, benefiting customers and stakeholders alike.
