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Huntington Bancshares is approaching a deal to merge with TCF Financial

Huntington Bankshares Co., Ltd.

HBAN -0.77%

Approaching a deal to merge with TCF Financial Co., Ltd.

TCF -2.50%

, According to those familiar with this issue, it is the latest in a series of recent partnerships with regional banks.

The two companies are discussing all equity deals that may be announced on Monday, assuming the negotiations will not collapse. Given the $ 5.3 billion market value of Detroit-based TCF, this would be one of the larger bank combinations these days. Based in Columbus, Ohio, Huntington has a market value of $ 13 billion.

In total, the bank’s assets are approximately $ 170 billion, with a network of branches extending from Pennsylvania to Arizona, especially in the Midwestern states such as Illinois and Michigan.

Upon completion of the transaction, Huntington will approach Fifth Third Bank Corp FITB, the state’s most fierce competitor. -1.58%

And key Co., Ltd.

Key -1.49%

, With assets of approximately $ 200 billion and $ 170 billion, respectively.

TCF’s nine-state network adds about 475 new branches and five states where Huntington is physically non-existent. Huntington’s 839 branch spans seven states.

Huntington has a reputation as a takeover hound. First Merit Corp, a bank in Ohio in 2016. Acquired and significantly strengthened its presence in the Midwest. TCF is no stranger to dealing with making. The merger has nearly doubled in size less than two years after the deal with Chemical Financial Corp. was signed.

Banking is accelerating this year, especially among regional banks seeking scale to become more competitive with larger competitors such as JPMorgan Chase and Company and Bank of America. .. Co., Ltd.

With a larger budget to develop flashy apps and support a broad network of branches, major national banks are adding customers and expanding into areas that were once dominated by local banks. The integration allows banks to eliminate overlapping costs, such as regulatory compliance and digital investment, which often weigh on revenue.

Low interest rates are especially severe for regional banks, which rely on lending profits more than large banks. The net interest margin, the difference between what banks pay depositors and what they get from loans, hit a record low for a commercial bank in the third quarter.

First Citizens Bank Shares Co., Ltd.

Agreed to acquire CIT Group Co., Ltd.

In a transaction to set up a bank with assets of about $ 100 billion in October. November, PNC Financial Services Group Co., Ltd.

Agreed to purchase the US division of BBVA in Spain for $ 11.6 billion. This is a combination that creates the fifth largest US retail bank with assets of over $ 550 billion.

Truist Financial Corp, the largest banking transaction since the financial crisis introduced stricter regulations after the merger of two major regional banks, BB & T and SunTrust, last year. became.

Write to Cara Lombardo (cara.lombardo@wsj.com) and Orla McCaffrey (orla.mccaffrey@wsj.com)

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Huntington Bancshares is approaching a deal to merge with TCF Financial

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