BB&T Corp., the fifth-largest banking company in the Southeast, is ready to discuss "a merger of equals" with another banking company, a securities firm, or even an insurance company, said John Allison, its chief executive officer.
"We've talked to lots of people about doing a merger of equals," Mr. Allison said in an interview late Tuesday in his office at BB&T's headquarters in Winston-Salem, N.C. "In order to survive, we'll have to do another merger of equals over the next five to 10 years. We just have to wait for the right time and the right opportunity."
BB&T is not holding talks now, but Mr. Allison said he is willing to negotiate with suitable partners. He had tried to initiate a deal with Regions Financial Corp. of Birmingham, Ala., "but we couldn't make the price work." Regions bought AmSouth Bancorp. of Birmingham for $10.2 billion this month.
Mr. Allison would not say what terms he would accept, except to say, "We'd have to feel confident that our culture would survive."
BB&T has a market value of $23.6 billion and about $119 billion of assets. Mr. Allison said about 10 to 15 "commercial finance" companies, some of them banking companies, might fit well with BB&T as equal partners. He would not name them.
To compete with the likes of Citigroup Inc., JPMorgan Chase & Co., or American International Group Inc., BB&T will have to get bigger, he said. Only 15 companies will dominate the U.S. banking, securities, and insurance industries a decade from now, he added.
For years his company, founded in 1872 by the son of a wealthy farmer, grew mainly by extending agricultural loans. In the 1960s and 1970s it began pursuing acquisitions, and in 1994 it became the fourth-largest banking company in North Carolina, behind NationsBank Corp. (now Bank of America Corp.), Wachovia Corp., and First Union Corp., which bought the old Wachovia in September 2001.
In 1997, Mr. Allison, who became the CEO in 1989, kicked off a buying spree at BB&T that included 80 acquisitions in seven years and extended his company's reach into Georgia, Tennessee, Florida, and the District of Columbia.
In 2003 it bought First Virginia Banks Inc. for $3.2 billion, BB&T's largest acquisition to date. After buying Republic Bancshares of St. Petersburg, Fla., in April 2004, Mr. Allison imposed a temporary freeze on purchases. "We kind of got indigestion," he said.
Last year BB&T started looking for acquisitions again. This year it bought Main Street Banks Inc. of Atlanta for $613 million in June and First Citizens Bancorp of Cleveland, Tenn., for $143 million in August.
Mr. Allison said he had approached Mercantile Bankshares Corp., a Baltimore holding company for 11 community banks, and two Florida companies, Harbor Florida Bancshares Inc. and Fidelity Bankshares Inc., but backed away because he was not prepared to outbid rival suitors.
PNC Financial Services Group Inc. of Pittsburgh announced a deal last month to buy Mercantile, and National City Corp. of Cleveland is buying the Florida companies.
