PNC Financial Services Group Inc. will significantly expand its presence in the Washington region with the acquisition of Mercantile Bankshares Corp. for $6 billion in stock and cash, company officials announced Monday.
The deal, which is expected to close during the first quarter of 2007, will add 32 PNC branches to the Washington region. PNC already has a strong presence in the District; the The Mercantile Bankshares branches will give it a wider footprint in the Washington suburbs, said a spokeswoman for Mercantile. Mercantile has 240 branches total in the Mid-Atlantic region and owns 11 community banks. Thirty of Mercantile’s Washington area branches are in Northern Virginia and suburban Maryland.
This is PNC’s second acquisition of a bank in the Washington area in as many years. The company first entered the Washington market last year when it bought Riggs National Corp.
That deal gave PNC a presence in a market with a median income that’s 35 percent higher than the national average and this acquisition will add more affluent customers to PNC’s customer-base. Mercantile customers have a median income of $69,000 a year, 18 percent higher than PNC’s current customers, representatives from the two banks said in a Monday conference call.
Mercantile, which has $17 billion in assets, is “the jewel that fits between our Washington, D.C. franchise and our Philadelphia and Delaware and New Jersey franchise, said PNC Chief Executive Officer James E. Rohr. Once the deal is closed the additional assets will make PNC the 10th largest U.S. bank.
Bloomberg contributed to this report.
