PNC will end up with a nationwide footprint with a deal to acquire the U.S. operations of Spanish financial institutionBanco Bilbao.
The definitive agreement calls for PNC to acquire BBVA USA Bancshares, Inc., including its U.S. banking subsidiary, BBVA USA, for $11.6 billion in cash.
PNC has bank branches and other operations in Delaware.
BBVA USA Bancshares, with $104 billion in assets and headquarters in Houston, provides commercial and retail banking services through its banking subsidiary BBVA USA and operates 637 branches in Texas, Alabama, Arizona, California, Florida, Colorado and New Mexico.
When combined with PNC’s existing footprint, largely on the East Coast and Midwest, the Pittsburgh-based company will have a coast-to-coast presence in 29 of the 30 largest markets in the U.S. It will still lack a presence in the Pacific Northwest.
“Our acquisition of BBVA USA will accelerate our growth trajectory and drive long-term shareholder value through a strategic deployment of the proceeds from the sale of our BlackRock investment,” said William S. Demchak, PNC’s CEO. “This transaction is an opportunity to navigate our future from a position of strength, accelerating PNC’s national expansion strategy while drawing on our experience as a disciplined acquirer.”
PNC expects the transaction to substantially replace the net income benefit from PNC’s passive equity investment in BlackRock that was sold in May.
The acquisition adds approximately $86 billion of deposits and $66 billion of loans.
PNC expects to incur merger and integration costs of $980 million.
The transaction, which has been approved by both companies’ boards of directors, is expected to close in mid-2021, subject to customary closing conditions, including regulatory approvals.
PNC’s will keep in place its 2020 pledge to provide $30 million in charitable support for COVID-19 relief efforts, as well as a $1 billion commitment announced earlier this year to support economic empowerment and combat systemic racism of Black Americans and low to moderate-income communities.