Chime Financial Inc. (NASDAQ:CHYM)shares jumped nearly 10% in after-hours trading Tuesday after the company agreed to acquire its longtime banking partner, Stride Bank, for $590 million in cash.

The Deal Gives Chime Its Own Bank Charter

Stride Bank, founded in 1913 and headquartered in Enid, Oklahoma, has served as Chime’s banking partner for more than seven years and will be renamed Chime Bank, N.A. once the deal closes, operating as a wholly owned subsidiary.

Chime CEO Chris Britt said the acquisition would help the company “accelerate toward our vision to be the largest provider of primary bank accounts in America,” combining its technology and member relationships with Stride’s national charter.

The deal gives Chime full-stack ownership of its banking infrastructure rather than continuing to rely on a partner bank, eliminating partner-bank fees and reducing funding costs.

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Deal Terms

The transaction values Stride at approximately 1.5 times tangible book value and is expected to be accretive to Chime’s earnings per share upon closing, with more than $100 million in projected net synergies from sponsor bank fee savings, expanded lending products, and lower funding costs.

Chime plans to fund the deal entirely from its balance sheet cash, with no additional capital contribution expected.

The transaction is targeted to close in the first half of 2027.

Raises Q3 and Full Year Forecast

The company now expects third-quarter revenue of $705 million, up roughly 30% year over year, with adjusted EBITDA of $117 million to $120 million.

For the full year, Chime raised its revenue outlook in the range between $2.76 billion and $2.77 billion, a 26% to 27% growth with adjusted EBITDA expected to be between $481 million and $489 million.

Price Action: The company closed 4.3% lower on Tuesday at $32.31, but gained 9.53% to $35.39 in extended trading.

Benzinga edge rankings indicate Chime’s stock has a Momentum score in the 95th percentile and a positive price trend across the short, medium, and long term.

See More: Top Momentum Stocks

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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