First Union Corp. is close to ridding itself of more than 80 East Coast branches.
The Charlotte, N.C., banking company said it has signed deals to sell all but 20 of the branches it promised to unload in a restructuring announced in June. A spokesman said Monday that it hopes to find buyers for the remaining branches - in Florida, Georgia, and Virginia - by yearend.
Last week First Union announced plans to sell 10 branches to a pair of North Carolina companies: First Citizens Bank and First Bancorp.
First Citizens, a subsidiary of First Citizens Bancshares of Raleigh, is to buy six First Union branches in North Carolina and Virginia. First Bancorp, parent of First Bank in Troy, is to purchase the other four North Carolina branches.
Financial terms were not given. The First Citizens deal is set to close in the fourth quarter and other one in the quarter after that.
In late August, First Union said it would sell four branches to First Charter Corp. in Concord, N.C. A month earlier the company said it would sell all 41 of its Tennessee branches to Firstar Corp. of Milwaukee.
First Union's $2.8 billion restructuring also entails getting out of certain underperforming businesses and reinvesting what it saves in growth areas such as investment management and capital markets.
The shutdown of its Money Store consumer finance unit and job cuts are the largest part of the reorganization. To date the tally of the staffing cutbacks, which hit First Union's consumer banking business the hardest, stands at 5,291 jobs - 7% of First Union's work force.
Many branches being sold are in areas isolated from the core branch territory of First Union, which has more than 2,200 branches, a spokesman explained.
Michael Plodwick, an analyst with UBS Warburg, said the divestiture is only a small part of the retooling at First Union.
"More than anything, they feel these [branches] aren't hitting enough critical mass in a given marketplace," he said.
