All issues have taken a back seat to the onset of the Covid-19 virus. Since this first arose in China at the end of 2019, concern has steadily mounted, leading to unprecedented dislocations in global financial markets. Markets are volatile to a great degree because of uncertainty, not just about the extent and severity of the virus, but also about its economic impact.
In February 2019, BB&T announced its acquisition of SunTrust Bank for about $28 billion in stock. In December that year, the nation’s 6th biggest bank, Truist, was created. There are, of course, a multitude of reasons why financial institutions merge. A classic explanation is that they wish to obtain economies of scale by combining overlapping operations in particular markets. As regional commercial banks with a heavy consumer focus, both these institutions faced earnings pressure from developing headwinds in the mortgage market as interest rates climbed in 2018. (Table 1).