PNC Financial Services said on Monday that it would acquire the U.S. business of the Spanish lender BBVA for $11.6 billion.
The transaction, one of the biggest banking deals since the 2008 financial crisis, would create the nation’s fifth-largest retail lender, with more than $550 billion of assets. BBVA USA Bancshares, which is headquartered in Houston, has about $86 billion in deposits and $66 billion in loans.
For PNC, it would be the latest in a string of acquisitions it has used to grow its national footprint. It expanded its foothold in the Southeast with its $3.45 billion acquisition of Royal Bank of Canada’s U.S. retail banking in 2011, and bought National City bank, based in Cleveland, in 2008. With its acquisition of BBVA’s business, PNC will expand into Arizona, California, Colorado, New Mexico and Texas, giving it a presence in 29 of the country’s 30 biggest markets.
“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,” William S. Demchak, PNC’s chairman and chief executive, said in a statement.
BBVA’s shares rose by 15 percent in early trading in Madrid.
PNC, which is based in Pittsburgh and has a market capitalization of about $50 billion, serves eight million consumers and small businesses. Its sale this year of its stake in BlackRock, the world’s largest asset manager, for about $17 billion freed up cash to do another deal. Mr. Demchak had said he would use that capital to buy regional banks struggling to compete against larger rivals that have money to pour into technology and investment.
PNC said it expected the takeover to “substantially” replace the profit that the lender reaped from its stake in BlackRock.
The deal follows a spate of consolidation within the financial services industry. First Citizens BancShares said in October that it planned to buy CIT Group for about $2.2 billion, while BB&T and SunTrust announced plans to combine last year in a deal that valued the new lender at $66 billion.
PNC’s acquisition is expected to close by the middle of next year, pending approval by regulators and other closing conditions.