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Reg Rollbacks Seen As Bit Player In $28B BB&T-SunTrust Deal

Publisher: Law360
February 11, 2019

Mike Rave was quoted in an analysis article, "Reg Rollbacks Seen As Bit Player In $28B BB&T-SunTrust Deal," published by Law360. Despite criticism from Democratic lawmakers, who view the $28 billion merger between SunTrust and BB&T as a potentially dangerous byproduct of recent efforts to loosen post-crisis regulations on big banks, the article reports that financial services attorneys indicate that this deregulation is only a minor player in this latest banking industry consolidation.

As noted in the article, the Fed has called for relaxing certain capital requirements and other prudential standards for banks with between $250 billion and $700 billion in assets as part of its package of "tailoring" proposals unveiled last fall, but there, too, the biggest regulatory rollbacks are aimed at banks a step smaller than the proposed BB&T-SunTrust combination.

Rave told Law360 he is not sold on the idea that this particular merger is the result of these deregulatory efforts. To the extent rule rollbacks do spur transactions, it's going to be on the smaller end of the regional bank spectrum, where tie-ups can be expected to land below the new systemically important threshold, he commented. "You're going to see a lot more deals not necessarily above the $250 billion level, but between the $50 billion and $250 billion levels," Rave said.


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