After receiving necessary regulatory approvals in Jul 2015, BB&T Corporation BBT completed the acquisition of Susquehanna Bancshares, Inc. As part of the agreement, Susquehanna was integrated into BB&T’s Branch Banking and Trust Company segment. The $2.5-billion cash-and-stock deal was announced back in Nov 2014.
BB&T’s Chairman and Chief Executive Officer Kelly S. King said, “We are pleased to complete this strategic transaction and excited to welcome our new shareholders, clients and associates as we continue moving forward with the smooth integration of these two companies.” Notably, conversion of the core banking systems is expected to be completed during fourth quarter of 2015.
The acquisition of Susquehanna led to the addition of over 240 branches in Pennsylvania, Maryland, New Jersey and West Virginia. With $18.7 billion in assets and $13.8 billion in deposits from Susquehanna as of Mar 31, 2015, the deal will significantly boost BB&T’s organic prospects.
Also, as previously announced, BB&T will be creating three new geographic banking regions – Western Maryland and Pennsylvania, Central Pennsylvania, and the Greater Delaware Valley. Moreover, BB&T and Susquehanna will consolidate their existing regions in Maryland to form a new Maryland Region.
Additionally, BB&T anticipates the deal to be accretive to its earnings in the first full year (excluding one-time expenses). Further, the company will be saving nearly $160 million annually.
With no more pending deals, can we expect more such acquisitions from BB&T in the near term?
BB&T has always remained an active acquirer. This was the second major acquisition closed by the company in 2015. Earlier in June, the company completed the acquisition of The Bank of Kentucky Financial Corporation and added 32 branch locations. Last year, it had acquired more than 60 banking branches from Citigroup Inc. C.
With its strong liquidity position, BB&T is expected to remain keen on opportunistic acquisitions going forward. As of Jun 30, 2015, cash and due from banks stood at $1.6 billion. Also, the company’s capital position showed strength.
Further, BB&T intends to expand further in Alabama, Texas and Pennsylvania, organically or through acquisitions. This, in turn, will support the company’s top-line growth, which is presently strained owing to a low interest rate environment.
Currently, BB&T carries a Zacks Rank #3 (Hold). Some better-ranked major banks include Bank of America Corporation BAC and The Bank of New York Mellon Corporation BK. Both these stocks hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment