By Brandon Martin
First Horizon National Corp. announced that it has entered into a deal with SunTrust Banks Inc. and BB&T Corp. to acquire 30 branches across North Carolina, Virginia and Georgia on Nov. 8.
At the onset of 2019, U.S. regional lender BB&T agreed to buy SunTrust banks for approximately $28 billion in stock.
The two companies share the same region in the Southeast and Mid-Atlantic with approximately 3,000 combined branches. Of those, about a quarter of them are within a couple of miles of each other, American Banker reported. Until recently, it was expected that some of the branches in Martinsville, Henry and Patrick counties would be forced to close.
“First Horizon is excited to welcome new employees and customers to our family,” Bryan Jordan, CEO and chairman of First Horizon, said in a release. “We are proud of the tradition of trust we have earned for more than 155 years and look forward to working with BB&T and SunTrust to design a seamless onboarding experience.”
The SunTrust branches in Collinsville, Martinsville and Stuart are all slated to make the transition to First Horizon.
Due to the regulatory requirements involved in the SunTrust and BB&T merger, the branches are being divested. First Horizon will assume about $2.4 billion in deposits and will purchase roughly $410 million in loans. The deal is expected to close in early 2020 and First Horizon anticipates it will retain the SunTrust employees. The branches will operate under the First Horizon brand.
First Horizon noted that the new branch acquisitions were unrelated to their own recent merger with IberiaBank.
The merger between SunTrust and BB&T is not expected to take effect until the final months of 2019 or possibly not until early 2020. In the meantime, both banks will continue operating separately.
“We expect the transaction to close … in the fourth quarter of this year,” said Brian Davis, director of corporate communications at BB&T. “Once that (closing) happens, we will continue to serve clients through the legacy BB&T and SunTrust brands for some time until the two companies’ systems are merged.”
Once the two are finally integrated under the new bank company called Truist, consumers can expect changes to their accounts, interest rates, credit cards, automatic bill pay and mobile apps.
The two banks have not made any final decisions on what other branches will be consolidating.
“We recognize that as we combine our two companies, we’ll need to consolidate some branches, and we’ll be thoughtful in our approach and seek to minimize disruptions to our clients,” said Hugh Suhr, a SunTrust spokesman. “We have not determined which branches will be affected.”
The merger, announced in February, will make Truist the sixth-largest bank by assets in the U.S.
The bank merger is pending many regulatory approvals, including from the Federal Reserve Bank, Department of Justice and Federal Deposit Insurance Corp.
The combined bank is expected to spend an incremental $100 million annual investment on technology, Suhr said.
“For now, it remains business as usual and nothing changes,” he said. “Towards the end of 2019, we will follow up with additional information.”