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PNC Financial Services is in talks to acquire the US operations of Spanish lender BBVA for more than $ 11 billion, a person briefed on the matter said.
The sale, which could be announced as early as Monday, would be one of the biggest banking deals since the 2008 financial crisis. It would create the country’s fifth-largest retail bank, with more than $ 550 billion in assets, a said the person, who spoke on condition of anonymity because the discussions were confidential. The person warned that the deal was not yet over and could still collapse.
For PNC, it would be the latest in a series of acquisitions it has used to increase its national footprint. It expanded its footprint in the Southeast with its $ 3.45 billion acquisition of U.S. retail banking services from Royal Bank of Canada in 2011, and purchased Cleveland-based National City Bank, in 2008. With its acquisition of the BBVA business, PNC would expand into Arizona, California. , Colorado, New Mexico and Texas.
PNC, which is based in Pittsburgh and has a market capitalization of approximately $ 50 billion, serves approximately eight million consumers and small businesses. It has branches and ATMs in the Mid-Atlantic, Midwest, and Southeast.
The sale this year of its stake in BlackRock, the world’s largest asset manager, for around $ 17 billion, freed up more cash to close another deal. PNC Managing Director William S. Demchak has made it clear that he will use this capital to buy regional banks that are struggling to compete with larger rivals who have money to invest in technology and investment.
“We know that technology spending needs to increase,” Demchak said in September. “And we know the costs of credit are going to be high. And whether or not they put someone at risk, all of this suggests that a bank that doesn’t have paid products today is really going to struggle. “
This, he added, “gives us a lot of opportunities to deploy this capital”.
The deal follows a wave of consolidation within the financial services industry. First Citizens BancShares said in October that it plans to buy the CIT Group for around $ 2.2 billion, while BB&T and SunTrust announced plans to combine last year in a deal valuing the new lender at $ 66. billions of dollars.
The Wall Street Journal first reported the discussions on Sunday.
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