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E*TRADE Bank Snaps Up Chase USA Accounts

E*TRADE Group Inc. subsidiary E*TRADE Bank Monday cemented a deal to acquire more than 33,000 customers accounts from Chase Manhattan Bank USA, National Association, a subsidiary of J.P. Morgan Chase & Co. .

E*TRADE Bank said the accounts have deposits currently valued at more than $1.5 billion.

The company expects the move to be immediately accretive to both revenue and earnings, and said the addition of the new retail deposits should continue to widen its interest rate spreads while increasing the bank's revenue per household. Additionally, the bank intends to cross-sell its other financial products and services to the new customers.

"We continue to penetrate and consolidate the marketplace on multiple fronts, both leveraging our leadership brand and capitalizing on acquisition opportunities to drive the growth of our core business lines," said Mitchell Caplan, chief financial products officer and managing director, North America, E*TRADE Group. "The acquisition of Chase USA's high value accounts is another strong maneuver, allowing us to expand our customer base and capture a greater share of assets per household, while keeping acquisition costs low and improving profitability."

Financial terms of the deal were not disclosed. The transaction is subject to regulatory approval.