The Big Book FINANCIAL


Mergers and acquisitions


Big banks consolidate, benefiting Virginia-based institutions by Kate Andrews


I


n 2019, banks continued to merge and consolidate, and some closed branches in Virginia’s rural coun- ties and small towns, a trend expected to continue well into the 2020s. The big news of last year was the


completion of the $66 billion merger of BB&T Corp. and SunTrust Banks Inc. in December, creating Charlotte, North Carolina-headquartered Tru- ist Financial Corp., the sixth-largest bank in the country. It’s expected to take up to two years for the banks to fully merge operations and most branches will continue doing busi- ness under the BB&T and SunTrust brands until at least summer 2021. Meanwhile, in November 2019,


United Bank’s parent company entered into a $1.1 billion merger agreement with CresCom Bank’s parent. Like the BB&T-SunTrust deal, the two participating banks are headquartered outside of Virginia, but United has more than 60 branch locations here, primarily in Northern Virginia and the Shenandoah Valley. The deal is expected to close in the second quarter of this year. Also, in mid-February, Morgan


Stanley announced it would buy E-Trade Financial Corp., the online brokerage based in Arlington, for about $13 billion in an all-stock deal. E-Trade employs nearly 600 people in the Washington, D.C. area and made $2.88 billion in revenue last year. The combined company will have more than $3 trillion in client assets.


96 | MARCH 2020


BB&T and SunTrust branches are expected to convert to Truist branding by 2022.


Local banks had an eventful year,


with more branch closures, battles with an activist investment firm and a dispute with Virginia Credit Union. The Federal Reserve Board


noted in a November report that rural counties across the country are losing bank branches, including four counties in Virginia classified as “deeply affected.” In 2015, Virginia had 120 banks, and now there are 100.


Also, an activist investment firm


founded by a University of Virginia alum has put pressure on two small Virginia banks. Driver Management Co., based in New York, has bought stock to become shareholders on banks’ boards across the country, with the express purpose of convincing them to sell to competitors. Earlier this year, the firm targeted Essex Bank in Richmond and, in 2019, the National Bank of Blacksburg, which repurchased 1 million of its 7 million


outstanding shares last March, fol- lowing investors’ request that the bank share excess capital with them. In other financial news last year,


local banks objected to the Virginia Credit Union’s membership offer to the Medical Society of Virginia’s 10,000 members, a move approved by the state Bureau of Financial Institu- tions last July. The Virginia Bankers Association and seven community banks filed a request for a stay on the society’s credit union membership, which the State Corporation Com- mission granted in August. The banks said that VACU, which has more than $3.7 billion in assets, enjoys an uneven playing field with fewer taxes and a lighter regulatory burden — and could cause competing local banks to lose customers. In late January, the SCC hearing examiner ruled that the case will go to an evidentiary hearing this May or June.


PRNewsfoto/Truist


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96  |  Page 97  |  Page 98  |  Page 99  |  Page 100  |  Page 101  |  Page 102  |  Page 103  |  Page 104  |  Page 105  |  Page 106  |  Page 107  |  Page 108  |  Page 109  |  Page 110  |  Page 111  |  Page 112  |  Page 113  |  Page 114  |  Page 115  |  Page 116  |  Page 117  |  Page 118  |  Page 119  |  Page 120  |  Page 121  |  Page 122  |  Page 123  |  Page 124  |  Page 125  |  Page 126  |  Page 127  |  Page 128  |  Page 129  |  Page 130  |  Page 131  |  Page 132  |  Page 133  |  Page 134  |  Page 135  |  Page 136  |  Page 137  |  Page 138  |  Page 139  |  Page 140