Top Senate Democrat presses BB&T, SunTrust on impact of merger
WASHINGTON — The top Democrat on the Senate Banking Committee is questioning the chief executives of BB&T and SunTrust Banks on how their proposed merger will impact employees, consumers and the communities they serve.
In a letter to BB&T Chief Executive Kelly King and SunTrust CEO William Rogers, Sen. Sherrod Brown of Ohio said the banks touted the $1.6 billion in annual cost savings of the $28.2 billion deal, as well as expected returns to shareholders, but failed to provide enough information on how employees, consumers and communities would be affected if the deal goes through.
“You did not describe how innovation, automation, overlapping footprints, and operational efficiency would impact the banks’ workforce,” Brown said in a letter Wednesday. “Nor did you describe how an increased focus on technology would influence brick and mortar branches. You did not mention the consequences to consumers and small businesses of reduced competition in shared markets. You also failed to make clear the anticipated effects of the merger on the people who rely on your banks in their daily lives.”
Specifically, Brown is asking the executives how many employees will be retained by the proposed combined bank and what efforts will be made to relocate or reassign workers displaced if the deal moves forward.
He is also asking how the $1.6 billion in annual cost savings will be allocated and whether it will be reinvested in the communities the banks serve. And he is asking how many branches will be eliminated immediately and over the next decade.
Because BB&T and SunTrust “compete in many of the same markets,” Brown is asking how the merger will impact the costs of financial services to the banks’ current customers. He is asking whether products and services that the banks currently offer would be eliminated and what steps the combined bank would take to maintain “close ties” to customers and communities within their existing footprints.
He is also asking how the merger would benefit families and small businesses.
In the letter, Brown said the deal “deserves scrutiny because it would be of a magnitude that we have not seen since the financial crisis, creating the sixth largest bank in the country.”
He is asking the executives to respond to his inquiry by April 15.