BANK MERGER BB&T AND SUN TRUST. “..the deal is weighted toward BB&T, whose shareholders will own around 57 percent of the new bank..” By Todd Horwitz, Bubba Trading.


BB&T Corp. struck a deal to buy SunTrust Banks Inc. for $28.2 billion, combining two regional lending powerhouses to create the sixth-largest U.S. retail bank and end a decade-long drought in big bank mergers.

The all-stock deal is the largest U.S. bank merger since the financial crisis ushered in a stricter regulatory regime that kept banks on the sidelines of recent deal-making booms. Bank rules have loosened considerably following President Trump’s 2016 election, leading some to predict a flood of consolidations among smaller banks.

Both of the banks are calling it a “merger of equals.” But the deal is weighted toward BB&T, whose shareholders will own around 57 percent of the new bank compared with SunTrust shareholders’ 43 percent. 

BB&T Chairman and CEO Kelly S. King will perform those same roles in the new bank until 2021 — when current SunTrust Chairman and CEO William H. Rogers Jr. will take over as CEO. Until then, Rogers will serve as president and chief operating officer. The new company’s board will be evenly split between the banks’ current boards of directors.

“This is a true merger of equals, combining the best of both companies,” King said in a news release about the plan, which he said would bring the banks new scale that will help them “compete and win in the rapidly evolving world of financial services.”

The merger joins two banks that have grown along with the bustling Southeast and Mid-Atlantic regions where they began. BB&T has more than 1,800 financial centers in 15 states and Washington; SunTrust has an extensive network of branches, along with corporate and investment banking operations.

When the two Southern banks are combined, the new company will serve more than 10 million U.S. households, with approximately $442 billion in assets, $301 billion in loans and $324 billion in deposits, according to a joint news release detailing the plan.Mr. Son, the Vision Fund’s creator, said he was considering when and how to raise more capital, but it wasn’t something that needed to be “rushed in the next few months.”

Todd “Bubba” Horwitz


Financial Markets and Political Commentary


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About the author

Todd Horwitz - Author of “Average Joe Options“. Todd began his trading career in 1980 at the CBOE. He was one of the original traders in the OEX & helped start the SPX. He is a member the CME where he trades S&P futures as well as foreign currencies & is a regular contributor to CNBC, Bloomberg, BNN, Fox & many other major news networks.