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Wells Fargo and Citigroup may acquire large regional banks as regulatory barriers fall under the administration

Wells Fargo and Citigroup are positioned to acquire large regional banks as the administration eased regulatory restrictions on mergers. While JPMorgan Chase and Bank of America are currently barred from major acquisitions due to holding more than 10% of national deposits, Wells Fargo and Citigroup have sufficient room under the cap to pursue lenders with assets exceeding $100 billion. Investment analysts have identified five regional banks as strong contenders for acquisition: Fifth Third, Huntington, Citizens, KeyCorp, and Regions. Additionally, Zions is noted as a potential fit for Wells Fargo, while First Horizon is a possible target for Citigroup. Wells Fargo CEO Charlie Scharf expressed openness to transformative deals to increase franchise value, though he noted the bank feels no pressure to pursue one. Conversely, Citigroup CEO Jane Fraser stated that the bank's current focus is on organic growth rather than acquisitions. Despite the favorable regulatory environment, high profits and rising share prices have made many banks eager to be buyers rather than sellers.

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