Binge and merge: Regions Bank and AmSouth Bank, two big Birmingham-based financial institutions, are one. The estimated $10 billion deal, announced today, would create a Top 15 bank that would actually remain based in Birmingham. At stake: $140 billion in assets, $100 billion in deposits, 2,000 offices, 37,000 employees and more than 2,800 ATMs in 16 states. Closer to home, a combined 6,000 local jobs are on the line, with layoffs looming as an inevitable side effect of the deal. Wait, weren’t we opposed to same-sector marriages?
• Regions, AmSouth to merge [Birmingham News]
The word on Wall Street: So far, investors are lukewarm about the merger. [stock prices: ASO | RF] “The companies say they can wring $400 million in annual cost savings out of the combination, including $150 million next year. That would amount to 10 percent of their combined expenses. The companies will also take $700 million in restructuring charges.” Just as long as they continue to give away free toasters. They still do that, right?
• Investors Shrug Off AmSouth-Regions Merger [Forbes]
Merge is the new black: The Regions/AmSouth deal is third largest bank takeover in the past three months. Capital One and Wachovia (which bought out Birmingham’s SouthTrust in 2004) have recently announced upcoming takeovers. It’s just the start of merger mania, experts say, as smaller regional banks join forces to compete against bigger institutions. Potentially good for investors, potentially bad for customers dependent on competition for accounts and service.
• Regions-AmSouth tie-up may herald more bank mergers [Reuters]
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