LONDON (ShareCast) - (Sharecast News) - BB&T and SunTrust Banks have agreed to combine in an all-stock merger of equals valued at approximately $66bn, in a deal that will create the sixth-largest US bank based on assets and deposits.
The pro forma company will have around $442bn in assets, $301bn in loans and $324bn in deposits, serving more than 10 million US households. The combined group, which will be headquartered in Charlotte, North Carolina, will operate under a new name and brand, which will be determined before the deal closes.

BB&T chairman and chief executive officer Kelly S. Sing said: "This is a true merger of equals, combining the best of both companies to create the premier financial institution of the future.

"It's an extraordinarily attractive financial proposition that provides the scale needed to compete and win in the rapidly evolving world of financial services. Together with Bill's leadership and our new SunTrust teammates, we're going to bring the best of both companies forward to serve our clients and communities."

The companies said the combined entity will be well positioned to achieve "industry-leading" financial and operating metrics with the strongest return profile among its peers. The expected benefits of the transaction include a pro forma efficiency ratio of 51%, peer best return on average tangible common equity of 22% and projected tangible book value per share accretion at close for BB&T shareholders of around 11%, or 6% fully accounting for one-time merger charges.

The merger is expected to generate an internal rate of return of approximately 18%.

BB&T and SunTrust expect to deliver around $1.6bn in annual net cost synergies by 2022, with the primary sources of cost savings likely to in facilities, information technology/systems, shared services, retail banking and third-party vendors.

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