Federated Investors Inc. (FII) agreed to acquire $17 billion in
money market assets from SunTrust Banks Inc. (STI) as the regional
bank completed a review of what to do with the operation.
Atlanta-based SunTrust has seen losses narrow recently as credit
trends have improved. It serves an area that was hit especially
hard by the real estate crash. Its wealth and investment management
business saw latest-quarter earnings double.
Federated, a Pittsburge-based asset manager, has been moving to
diversify amid expected tightening in money-market fund
regulation.
Under the deal, SunTrust will transfer turn over assets in nine
money-market funds managed by its Ridgeworth Capital Management
business to six Federated funds with similar investment objectives.
Certain assets SunTrust maintains in collective and common funds
will also be transferred. The series of transactions, subject to
consent processes and approvals, is expected to close by year
end.
SunTrust will retain Ridgeworth's long-term asset-management
business. RidgeWorth and affiliated businesses had $65.1 billion in
assets as of March 31. Federated managed nearly $350 billion.
SunTrust shares were down 2.1% in light premarket trading to
$24.65, in line with other large banks, while Federated was
inactive.
-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240,
matthew.jarzemsky@dowjones.com