BB&T Corp (BBT) is picking up Citigroup's (NYSE:C) unwanted Texas branches.
The Winston-Salem, N.C., company said Wednesday that it agreed to buy 21 Citibank branches in Texas, along with $1.2 billion in deposits and $134 million in loans. BB&T will pay a premium of 4.25% of core deposits, or approximately $36 million, it said.
The 21 locations include all of Citi's branches in the Austin, San Antonio and Bryan-College Station markets, BB&T said. The sale would shrink Citi's Texas network to 78 branches, according to data from the Federal Deposit Insurance Corp.
In a statement, Citi said that a review of its branch network determined that the 21 locations "do not complement our market strategy," while noting that Texas "will continue to be an important market for [us]."
The $181 billion-asset BB&T would have 81 locations, $2.8 billion of deposits and $2.1 billion of loans in Texas following the acquisition. BB&T entered the state in 2009, with the purchase of the failed Colonial Bank. It recently opened 30 new Texas offices, while shuttering branches elsewhere in its 12-state footprint.
"This acquisition is a compelling strategic expansion in Texas, where the BB&T brand and approach to client service have been very well received," said BB&T Chief Executive Kelly King in a news release.
Citi CEO Michael Corbat has been shutting branches and laying off employees this year in an effort to keep costs down.