SunTrust Receives Fed Approval For Merger Deal With BB&T
Zacks Investment Research | Nov 19, 2019 08:51PM ET
SunTrust Banks (NYSE:STI) has received approval from the Federal Reserve's board of governors and the Federal Deposit Insurance Corporation for the previously announced “merger of equals” with BB&T Corp. (NYSE:BBT) .
However, the Fed has also hit SunTrust with an enforcement action for unfair practices related to customer fees between 2013 and 2017, which the combined company is expected to comply with.
Notably, the merger of equals will create the sixth-largest commercial bank in the United States (in terms of assets and deposits). It is expected to close on Dec 6, 2019, subject to the satisfaction of customary closing conditions.
The all-stock deal is valued at $66 billion. The combined bank, to be named Truist Financial Corp., will be headquartered in Charlotte.
Kelly King, the CEO of BB&T, who will serve as the CEO of Truist, stated, “We are pleased to have received regulatory approval to merge two strong companies with complementary business models and a high level of cultural alignment. We'll be even better together for our clients, teammates, communities and shareholders.”
The merger is projected to result in earnings accretion for shareholders of both companies. Moreover, share repurchases have been suspended by both companies until the closure of the transaction. (Read more: Original post
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