Huntington Bancshares in Talks to Buy FirstMerit--Sources
January 25 2016 - 7:20PM
Dow Jones News
Huntington Bancshares is in advanced talks to acquire FirstMerit
Corp., according to people familiar with the matter, a tie-up that
would combine the two Ohio-based banks.
Akron, Ohio-based FirstMerit is expected to be sold at a premium
to its roughly $2.67 billion market capitalization, one of the
people said. The deal could be announced as soon as late Monday,
these people said. FirstMerit is scheduled to report its
fourth-quarter earnings on Tuesday.
As with all deal discussions, talks could fall apart at the last
minute.
The largest U.S. lenders are effectively prohibited by
regulators from doing big deals, but regional banks have steadily
consolidated since the financial crisis. These banks face pressure
on their profits from regulatory costs and low interest rates,
factors that have played a role in some of this consolidation.
Any deal could help the Midwestern banks boost their overlapping
footprints as well as spread the increasingly expensive costs of
government regulations, such as compliance, over a broader revenue
base.
Columbus, Ohio-based Huntington, with $71 billion in assets, is
one of the smaller banks to be subject to the Federal Reserve's
"stress tests," which apply to firms with at least $50 billion in
assets. FirstMerit had $25.2 billion in assets as of Sept. 30.
Huntington was in advanced deal talks to buy another regional
bank, First Niagara Financial Group Inc., in October, people
familiar with the matter said. KeyCorp was the eventual buyer of
First Niagara.
Write to Emily Glazer at emily.glazer@wsj.com and Rachel Louise
Ensign at rachel.ensign@wsj.com
(END) Dow Jones Newswires
January 25, 2016 19:05 ET (00:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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