Huntington Bancshares Incorporated, the parent company of The Huntington National Bank, and TCF Financial Corporation (TCF), the parent company of TCF National Bank, announced the signing of a definitive agreement under which the companies will combine in an all-stock merger with a total market value of approximately $22 billion to create a top 10 U.S. regional bank with dual headquarters in Detroit, MI, and Columbus, OH.

With a rich history of caring for customers and colleagues, the new organization will have a top five rank in approximately 70 percent of its deposit markets and will leverage its scale to serve customer needs through a distinctive, “People-First, Digitally Powered” customer experience. Footprint is defined as IL, IN, MI, MN, OH, WI, WV, Denver and Pittsburgh.  Excludes all deposits above $0.5 billion at any branch.
 
Under the terms of the agreement, which was unanimously approved by the boards of directors of both companies, TCF will merge into Huntington, and the combined holding company and bank will operate under the Huntington name and brand following the closing of the transaction. Upon closing, Stephen D. Steinour will remain the Chairman, President and CEO of the holding company and CEO and President of the bank. Gary Torgow, current Executive Chairman of TCF Financial Corporation, will serve as Chairman of the bank’s board of directors.

“This merger combines the best of both companies and provides the scale and resources to drive increased long-term shareholder value. Huntington is focused on accelerating digital investments to further enhance our award-winning people-first, digitally powered customer experience,” Steinour said. “We look forward to welcoming the TCF Team Members. Together we will have a stronger company better able to support our customers and drive economic growth in the communities we serve.”

The headquarters for the Commercial Bank will be in Detroit where at least 800 employees of the combined company, nearly three times the number TCF had planned, will be housed in the downtown structure. Columbus will remain the headquarters for the holding company and the Consumer Bank.

“This partnership will provide us the opportunity for deeper investments in our communities, more jobs in Detroit, an increased commitment in Minneapolis and a better experience for our customers,” Torgow said. “We will be a top regional bank, with the scale to compete and the passion to serve. Merging with the Huntington platform will be a great benefit to all of our stakeholders and will drive significant opportunities for our team members.”  

The pro forma combined company will have approximately $168 billion in assets, $117 billion in loans and $134 billion in deposits. The combined organization will significantly improve Huntington’s market position, increase scale and provide greater revenue growth opportunities. The company is expected to extend its top quartile financial metrics after completion of the integration.

Huntington expects the financially compelling transaction to be 18 percent accretive to earnings per share in 2022, assuming the fully phased-in transaction cost synergies. The merger positions the combined organization to capitalize on market opportunities and broaden the channels and customers it serves through expanded distribution and product offerings.

Strategic and Financial Benefits of the Proposed Merger

• Enhanced Profitability and Scale: The combined company’s expanded distribution and scale positions Huntington to serve an expanded customer base through a distinctive customer experience while driving top-quartile financial performance.
• Significant Cost Synergies: Estimated cost savings of the combined company are approximately $490 million, or 37 percent of TCF’s noninterest expense.
• Revenue Growth through Combined Segments and Expanded National Footprint Businesses: The combined company will strengthen its Consumer, Wealth, Business Banking and Commercial businesses. Huntington will leverage its broader product and services offering, as well as its award-winning digital capabilities, across the expanded combined customer base. In addition, TCF operates national inventory and equipment finance businesses, which will complement Huntington’s existing commercial efforts.
• Strengthened Market Position: The combined company will maintain its leading market position with the largest branch share and second position in Consumer Deposits in the footprint. The combination expands the Huntington footprint to include Minnesota, Colorado, Wisconsin, and South Dakota, and deepens its presence in Chicago.
• Strong Brand and Cultural Alignment: The combined company expands the reach of Huntington’s “Welcome” culture and enriches an inclusive, diverse, high-performing team.
• Community Commitment: Huntington will contribute $50 million to a donor advised fund at the Community Foundation for Southeast Michigan to serve the needs of communities in Detroit and across the footprint of the combined bank. This donor advised fund will be in addition to commitments already made by both banks, including a combined $10 million to Detroit’s Strategic Neighborhood Fund. The combined company also will remain committed to Minneapolis, where TCF was founded nearly a century ago. Huntington and TCF have consistently earned “Outstanding” ratings under the Community Reinvestment Act. Huntington recently announced a $20 billion Community Plan, which is focused on driving economic inclusion through access to capital, affordable housing and home ownership, and community lending and investment. $5 billion is specifically dedicated to Michigan. The most recent component of the Community Plan is “Huntington’s Lift Local Business” which provides much-needed capital to local minority, woman and veteran-owned businesses, as well as giving customers access to business planning and educational programs to support local businesses. TCF also recently announced a $1 billion commitment over five years to support minority-owned and women-owned small businesses, which will be added to Huntington’s commitment. Huntington is the #1 SBA Lender in the nation for loan origination, and this merger will provide expanded opportunity to bring that expertise to a larger, combined footprint.

Board of Directors  

At closing, five current TCF Directors will be added to the Board of Directors of the holding company. David L. Porteous will serve as Lead Director of the holding company’s Board of Directors and the bank’s Board of Directors.

Timing and Approvals

The merger is expected to close in the second quarter of 2021, subject to satisfaction of customary closing conditions, including receipt of customary regulatory approvals and approval by the shareholders of each company.  

Advisors

Goldman Sachs & Co. LLC is serving as financial advisor to Huntington. Wachtell, Lipton, Rosen & Katz is serving as legal advisor to Huntington.

Keefe, Bruyette & Woods, a Stifel Company, is serving as financial advisor to TCF.  Simpson, Thacher & Bartlett LLP is serving as legal advisor to TCF.