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February 6, 2019

KeyBank to acquire online lending business Laurel Road

By Michelle Tuccitto Sullo

KeyBank National Association has filed an application with the state Department of Banking to acquire the digital lending business of Laurel Road Bank.

Although Laurel Road has three bank branches in southern Connecticut, including in Darien, Rowayton and Southport, these branches are not part of the transaction.

Bank officials said the acquisition will provide mutual benefits, with KeyBank enhancing its digital capabilities and technology while offering growth potential to Laurel Road. Financial terms of the transaction were not disclosed.

Chris Gorman, vice chair and president of banking with KeyBank, said in a statement, “We are thrilled to have the opportunity to partner with Laurel Road and to continue expanding their business.”

Laurel Road, based in New York City, is a national online lending company and FDIC-insured bank. It offers online student loan refinancing, personal lending and mortgage products, as well as consumer and commercial banking services. Since it started originating student loans in 2013, the company has helped thousands of graduates refinance and consolidate more than $4 billion in federal and private school loans.

Laurel Road serves professionals with undergraduate and graduate degrees, and has attracted a range of customers, including health-care professionals, lawyers and graduate students.

“Laurel Road has been an innovator in online lending and experienced significant growth,” Gorman said.

Gary Lieberman, founder and chairman of Laurel Road Bank, said the company is excited to combine its “technological expertise with Key's industry expertise.”

“We could not have found a better strategic partner to help take Laurel Road to the next level and continue our mission of serving millennial customers with technology that meets them where they are in their financial journey,” Lieberman said in an announcement. “Together, we will work to create an innovative digital financial experience for all of our customers.”

Key indicated it will acquire the Laurel Road team as part of the transaction, so about 140 Laurel Road employees will be joining Key.

In 2018, Laurel Road introduced a platform for mortgages using the same secure lending technology to offer homebuyers and owners a streamlined experience, from application to payment.

KeyCorp, a 190-year-old company headquartered in Ohio, is one of the nation's largest bank-based financial services companies, with assets of about $139 billion. It provides deposit, lending, cash management and investment services to individuals and businesses in 15 states.

Contact Michelle Tuccitto Sullo at msullo@newhavenbiz.com

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