First Citizens, CIT Plan Merger to Create $100bn Bank

First Citizens Bank and CIT Group have announced plans to merge, creating a $100 billion bank that would rank in top 20 institutions in the US.

In a statement, the two companies said the combined entity would be “well-positioned to leverage its product portfolio and technology across the franchises and make additional investments in technology to enhance the customer experience”.

The companies said the “transformational partnership” would give the banks greater scale to “drive growth, improve profitability and enhance stockholder value”.

The deal will combine First Citizens’ more than 550 retail banking locations and low-cost deposit franchise with CIT’s branch network across southern California, operating under the OneWest Bank brand, as well as the latter’s commercial lending business.

Headquartered in Raleigh, North Carolina, the new company will keep the First Citizens brand and stock market ticker, trading on the Nasdaq market. It will have more than $80 billion in total deposits.

Frank Holding Jr, chair and CEO of First Citizens, is to retain the same roles at the combined company, with CIT chair and CEO Ellen Alemany becoming vice chair.

Alemany and Holding will sit on the new 14-strong board of directors, made up of 11 current First Citizens board members and three CIT board members.

Holding said: “This is a transformational partnership for First Citizens and CIT designed to create long-term value for all of our constituents including our stockholders, our customers, our associates and our communities.”

Alemany added: “I’m proud of the work we have done to transform CIT in recent years to a leading, national commercial bank. This transaction will build on those efforts and more fully unlock the potential in our core franchises.

“In addition, the strength that is created as a larger US bank will enable greater opportunities for our team, our customers and our communities.”

The joint statement highlighted several business lines that the banks said would be “enhanced” through the merger, including deposits, mortgages, and small business lending.

Earlier this year, CIT Group completed the sale of its wealth advisory business to FirstSun Capital Bancorp. The business was part of Mutual of Omaha Bank, which CIT acquired in a deal completed on January 1, 2020.

The CIT-First Citizens merger is expected to complete in the first half of next year, and is subject to regulatory and shareholder approval.