BB&T and SunTrust are merging in what the banks call a “merger of equals” to create the sixth-largest bank in the U.S.
The all-stock deal, announced by the companies Thursday and valued at about $66 billion, will create a bank that serves more than 10 million U.S. households. A new name for the bank will be chosen before the deal’s expected closing in the fourth quarter of this year.
A new headquarters in Charlotte, North Carolina, will be established, but the company will maintain operations in BB&T’s current headquarters of Winston-Salem, North Carolina, and SunTrust’s of Atlanta.
BB&T CEO and Chairman Kelly King will be CEO and chairman of the new company and its bank subsidiary through Sept. 12, 2021. Then, he will become executive chairman until March 12, 2022 and remain on the board until the end of 2023. SunTrust CEO and Chairman William Rogers will serve as president and chief operating officer until King steps down and then become CEO.
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SunTrust shareholders will get 1.295 shares of BB&T for each share they own. They will own about 43 percent of the combined company, while BB&T shareholders will own about 57 percent.
BB&T and SunTrust’s deal is the largest global bank merger in more than a decade, according to Bloomberg.
The merger transforms the two banks into “the premier financial institution of the future,” King said in a statement announcing the merger. “It’s an extraordinarily attractive financial proposition that provides the scale needed to compete and win in the rapidly evolving world of financial services.”
The new bank will hold about $442 billion in assets, $301 billion in loans and $324 billion in deposits, the companies said. The banks expect to save about $1.6 billion in annual net cost synergies by 2022.
SunTrust (STI) shares rose nearly 9 percent in premarket trading to $64, while BB&T (BBT) stock rose more than 4 percent to $50.80.
Follow USA TODAY reporter Mike Snider on Twitter: @MikeSnider.