Fifth Third to acquire Comerica, forming America’s ninth-largest bank
Fifth Third announced on Monday that it has agreed to acquire regional bank Comerica in an all-stock transaction valued at $10.9 billion, News.Az reports, citing CNN.
The merger will create the ninth-largest bank in the United States, strengthening its footprint across the Midwest.
Regional lenders are looking to diversify revenue streams, strengthen balance sheets and expand into faster-growing markets as they recover from an industry-wide crisis in 2023 that shook investor confidence and exposed the risks of bank runs and troubles in commercial real estate.
Analysts have said consolidation is crucial for smaller lenders to compete with the nation’s largest banks, with several banks looking to take advantage of a potentially lighter regulatory environment under the Trump administration.
Comerica shareholders will receive 1.8663 Fifth Third shares for each Comerica share, valuing the deal at $82.88 per share based on Fifth Third’s closing price on October 3.
Shares in Comerica were last up 12% before the bell, while Fifth Third fell 3%.
“Record bank stock prices have also allowed for a greater currency to do deals, and today’s announcement will likely encourage more boardroom discussions about possible tie-ups, both large and small,” said Stephen Biggar, analyst at Argus Research.
The S&P 500 Banks Index has surged nearly 21% this year, outpacing the benchmark S&P 500’s roughly 14% rise.
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