PNC to Sell 61 National City Branches as Part of Merger
The PNC Financial Services Group Inc. (PNC), a Pittsburgh-based financial holding company with $128 billion in assets, has agreed to sell 61 western Pennsylvanian branches of National City Corp. (NCC) as a condition of the pending merger, the U.S. Department of Justice announced Thursday. "The divestitures in western Pennsylvania will ensure that consumers, small businesses, and middle market businesses in that area will continue to have choices for banking services and to enjoy the benefits of competition, while allowing PNC’s acquisition of National City to proceed," said Deborah Garza, acting assistant attorney general in charge of the Department’s antitrust division. The stipulation is that the companies sell 50 Pittsburgh-area branches with $3.35 billion in deposits, six Erie county branches with $249 million in deposits, four Crawford County branches with $186 million in deposits and a single Warren County branch with $120 million in deposits. The companies will also be required to divest approximately half of National City’s lending and related business with middle market customers -- businesses with lending needs of more than $1 million -- in the Pittsburgh area, and virtually all of that business in the Erie area. Whatever company acquires that business will be given the opportunity to hire the National City personnel who manage the customer relationships related to the business, the Department of Justice said in a press release. It was announced on Oct. 24 that PNC would acquire Cleveland-based National City, a mortgage banker and servicer with $151 billion in assets. At the time of the announcement, it seemed both companies were expecting such a shift in operations. "The transaction is expected to result in the reduction of approximately $1.2 billion of noninterest expense through the elimination of operational and administrative redundancies," read the late-October press release out of PNC. Write to Diana Golobay at firstname.lastname@example.org. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.