That’s according to a report Monday (Oct. 27) by the Wall Street Journal (WSJ), which calls the all-stock deal the latest indication that such acquisitions are once again an option for banks facing pressure in a highly segmented sector.
The deal gives Huntington around $276 billion in assets and raises its profile among so-called “super-regional” banks, and helps it expand into the south, where Cadence — headquartered in Texas and Mississippi — is based.
The deal represents an “important next stage” for Huntington, CEO Steve Steinour told the WSJ in an interview.
The report adds that the banking sector has been waiting for a surge of regional/community bank consolidation to bolster competition from industry giants such as JPMorgan Chase and Bank of America.
The Trump administration, the WSJ added, has indicated a friendlier approach toward bank consolidation, with several multibillion-dollar deals happening recently.
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“I do think there will be more” deals, said Steinour, who said the two banks have been in talks for roughly four months. The regulatory environment is “constructive.”
Among the recent deals, Fifth Third Bancorp announced it would acquire Comerica for $10.9 billion. Last month, PNC announced a $4.1 billion deal to acquire FirstBank, a lender headquartered in Colorado.
And in May, Nebraska-based bank FNBO said it would acquire Missouri’s Country Club Bank. The two privately held banks completed their merger at the start of this month.
In other banking news, PYMNTS last week examined the implications of a national shortage of bank examinators as the Federal Deposit Insurance Corp. (FDIC) cuts jobs.
The number of examinations, that report said, fell 11% last year, while the number of “problem institutions” as of the end of the surveyed period rose 55% to 68.
The FDIC Office of Inspector General (OIG) has acknowledged that “the full effect and impact … due to the hiring freeze, deferred resignations, and any reshaping and restructuring remain to be seen,” promising to adjust oversight work to examine those changes. But with the agency’s succession-management review on hold, it is not clear when the regulator will begin rebuilding its examiner operations.
“For banks, timing matters,” the report continued. “Examiners increasingly serve as the interpretive bridge between FinTech APIs and prudential standards. A diminished workforce could slow risk-model validation, third-party vendor approvals, and emerging-technology reviews — precisely where supervisory clarity is most needed.”
