BB&T and SunTrust to merge creating sixth-largest US bank

BB&T and SunTrust to merge creating sixth-largest US bank

BB&T and SunTrust to merge creating sixth-largest US bank

The new bank will have a new name that hasn't been announced yet. It will be the sixth-biggest commercial bank in the assets, supplanting PNC Financial Services Group Inc.

The combined bank, which will be named at a later date, will have nearly 60,000 employees and about $440 billion in assets.

"The end result of the transaction is a very powerful company in some of the best markets in the United States", he said. The companies operate banks from Pennsylvania to Florida, and as far west as Texas. Wells Fargo merged with Wachovia, JPMorgan acquired Bear Stearns and Washington Mutual and Bank of America purchased Merrill Lynch.

Since that time, the gap between the size of the big Wall Street banks and the regional banks like BB&T, SunTrust, PNC Bank, Fifth-Third and others has only widened. The deal would create the sixth-largest bank in the US, with a combined $442 billion of assets and a customer base of more than 10 million households. JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, Goldman Sachs and Morgan Stanley brought in more than $120 billion combined in profit past year, the result of President Donald Trump's corporate tax cuts and a booming economy.

The Trump administration is taking a much softer stance on bank regulations, and has appointed dozens of new business-friendly policymakers into critical positions at the nation's bank regulators.

The banks said the deal will allow more investment in technology while cutting more than 10 percent of combined total expenses through eliminating duplicate branches and digital systems.

The new merged bank will have a new name, the companies said, and will be headquartered in Charlotte, North Carolina.

It will keep a community banking center in Winston-Salem, North Carolina, where BB&T is based.

Shares of SunTrust jumped 9.8 percent before the market open, while BB&T's stock rose 5.5 percent. The new company's market value will be about $76 billion.

Bank of America is the market leader with $21.3 billion in deposits and a almost 30 percent market share.

King told analysts the companies would be "careful and methodical" about which branches they close. The transaction would deliver at least $1.6 billion in annual cost savings by 2022, the companies said.

Kelly King, BB&T's chief executive officer, will be CEO of the combined company until September 12, 2021, after which SunTrust CEO Rogers will take over.

UBS bank analyst Saul Martinez said in a note to clients that "at first blush, this looks like a good deal for BB&T", given both the financial terms of the deal and the fact that SunTrust's "footprint is in higher income and household density markets".

Executives said they did not expect regulators to demand significant divestitures and that the deal would close in the fourth quarter of 2019.

The Baltimore Sun staff contributed to this report.

On Dec. 7, the Federal Reserve Board quickly approved two of the largest bank mergers of the year, Cadence Bancorp's merger with State Bank Financial Corporation and Synovus Financial Corp's merger with FCB Financial Holdings.

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