Bailout

PNC and Valley National Get on the Dole

By Admin

PNC Finacial Services Group and Valley National Bancorp became the tenth and eleventh banks to sell preferred equity to the US Treasury, the first to volunteer after the original nine major banks were conscripted into the capital infusion program by Secretary Paulson earlier this month.

Pennsylvania based PNC Financial will be using its $7.7 Billion of TARP funds to help finance the acquisition of Ohio-based The all-stock transaction values the National City at $5.2 billion and provides it’s shareholders with 0.0392 PNC shares for each National City share, or $2.23 per share, 19% less than National City?s closing price the day before the announcement. The combined regional bank will be the fifth largest bank by deposits with over $180 Billion.

New Jersey based Valley National sold a more modest $330 Million of preferred shares to Treasury which it intends to use for general corporate purposes and to possibly acquire other banks according to a press release announcing the bank’s participation in TARP’s Capital Purchase Plan. Valley is a relatively small, relatively healthy regional bank with $14.3 Billion in assets and total risk-based capital, Tier I capital, and leverage capital were 10.12 percent, 8.41 percent, and 6.83 percent, respectively (as of the third quarter).

Full post as published by Bailout Report on October 25, 2008 (boomark / email).