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Friday, September 05, 2014 11:56:05 AM
North Carolina-based BB&T Bank is continuing to expand its footprint in Texas with the acquisition of 41 more branches from Citibank.
For Citibank, the deal represents the end of its retail branch network in Texas, although the giant financial institution operates other lines of businesses in the state.
The latest deal between the two banks, announced Wednesday, includes retail branches in the Dallas, Houston, Midland and Odessa markets. In total, the acquisition adds $2.3 billion in deposits and $87 million in loans to BB&T.
Of the 41 newly acquired branches, 24 are in the Dallas region. That will bring BB&T’s number of branches in D-FW to 58.
When the deal closes, BB&T will be one of the 15 largest banks in Texas by deposit share, with $5.3 billion in deposits. Its retail network statewide will include 123 branches.
Texas has been an important growth market for BB&T since it entered the state five years ago. BB&T also operates in 11 other states and Washington, D.C.
“Texas has a great economy and is a great market for BB&T,” said Kay St. John, BB&T’s North Texas regional president based in Dallas.
In December, BB&T acquired 21 branches in the Austin, Bryan-College Station and San Antonio markets from Citibank. That deal added $1.2 billion in deposits and $134 million in loans.
In contrast, Citibank has been paring its retail branch network in Texas during the past year. At one point, Citi had 100 branches in Texas, including 20 in Dallas. Besides selling a bulk of its branches to BB&T, Citi also has closed branches in the state.
Despite the lack of statewide retail branch network, Citi spokesman Andrew Brent said Texas remains a “vibrant growth state.” With about 9,500 employees, Texas represents the second-largest Citi workforce in the U.S.
The bank has major operations in San Antonio and Irving. Other lines of businesses in Texas include corporate and investment banking, commercial banking and consumer lending.
“However, our branch footprint in Texas did not provide the scale to capture future growth and market share in traditional retail banking,” Brent said in a prepared statement. “We see the retail banking industry rapidly evolving beyond a purely branch-based model, and so we will dedicate our resources and investments on a more focused branch footprint in our major urban markets and on expanding our digital channels nationally.”
BB&T said it will pay a premium-to-book value of about 5.3 percent of total deposits in the latest transaction with Citibank. The deal is expected to close in the first quarter.
BB&T entered the state in 2009, when it acquired Alabama-based Colonial BancGroup, which was shut down by federal regulators in one of the biggest bank failures during the financial crisis. With that acquisition, the bank gained 19 branches in Dallas-Fort Worth and three in Austin.
BB&T will have 2,050 employees statewide when the Citibank deal closes. The bank operates other units such as wealth management, investment banking and insurance.
Follow Hanah Cho on Twitter at @hanahcho.
http://www.dallasnews.com/business/headlines/20140903-bbt-acquires-another-41-branches-in-texas-from-citibank.ece
Brilliant.
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