The Federal Reserve Board on Tuesday announced its approval of the application by Citizens Financial Group, Inc. to acquire Investors Bancorp, Inc., and thereby indirectly acquire Investors Bank.

Citizens Financial Group and Investors Bancorp announced in July 2021 that they had entered into a definitive agreement and plan of merger under which Citizens will acquire all of the outstanding shares of Investors for a combination of stock and cash. The deal was valued at $3.5 billion.

The Federal Reserve said to incorporate the effects of this material acquisition into Citizens Financial Group's capital requirements, the Board will use the 2023 stress test to recalculate its stress capital buffer, which is part of a firm's capital requirements. Citizens is normally on a two-year stress test cycle and will receive a new stress capital buffer this year. However, because this year's test will not include the effects of the acquisition, the additional 2023 recalculation is being required.