BB&T Corporation, a bank holding company that offers consumer and commercial banking, securities brokerage, asset management, mortgage, and insurance products agreed to buy its rival SunTrust Banks, Inc.
The merger is addressed as the largest bank merger since the 2007-2009 financial crisis and to be the sixth biggest bank merger respectively. Both companies will discard their names and headquarters and will operate under a new bank based in Charlotte, North Carolina.
According to BB&T CEO Kelly King, the combination provides the scale needed to compete and win in the rapidly evolving world of financial services. King also said that the deal is ‘positive for everybody.’
Even though King said that the combination is positive for everybody, there are still people who are not pleased with the deal. Maxine Waters, chairwoman of the House Financial Services Committee said that the proposed merger between SunTrust and BB&T is a direct consequence of the deregulatory agenda that Trump and Congressional Republicans have advanced.
As part of the deal, SunTrust shareholders will receive 1.295 shares of BB&T for each share they own. BB&T shareholders will own 57 percent of the combined company and SunTrust will own the rest.
William Rogers, SunTrust CEO said that the business has been changing and will be changing. The combination will give them the opportunity to be absolutely the most competitive bank.
The two banks are said to have been considered a longtime natural partners and advisers. The talks between these two began in 2018. Even though BB&T shareholders will own the majority of shares, SunTrust’s key point will make the two banks equal.
King will serve as CEO of the combined company through Sep. 12, 2021, when Rogers will take over. He will also serve as executive chairman for six months. Both companies expect to close the deal later this year.