Huntington Bancshares Incorporated announced Monday (Oct. 28) it will acquire Cadence Bank for $7.4 billion in an all-stock transaction, further accelerating the trend of consolidation within the banking sector. The deal, expected to close in the second quarter of 2024, will create a $42 billion asset bank with a strengthened presence across the Southeast and Midwest.
Huntington Chairman and CEO Stephen Steinour stated, “I do think there will be more” deals, adding that the two banks have been in talks for roughly four months and the regulatory habitat is “constructive.”
The acquisition follows a series of recent multibillion-dollar bank mergers. Fifth Third Bancorp announced it would acquire Comerica for $10.9 billion, and last month, PNC announced a $4.1 billion deal to acquire FirstBank, a Colorado-based lender. In May, Nebraska-based FNBO said it would acquire Missouri’s Contry Club Bank.
Meanwhile, the banking industry faces a growing shortage of bank examiners as the Federal Deposit insurance Corp. (FDIC) cuts jobs. The number of examinations fell 11% last year, while the number of “problem institutions” rose 55% to 68 as of the end of the surveyed period, according to a recent PYMNTS report. The FDIC Office of Inspector General acknowledged the potential impact of staffing changes, stating the “full effect … due to the hiring freeze” remains to be seen. The report highlighted that a diminished examiner workforce could slow risk-model validation, third-party vendor approvals, and emerging-technology reviews.
