Fifth Third Buys Comerica for $10.9B in Year’s Biggest Bank Deal. Which Firms Might Be Next.

Fifth Third Bank headquarters in Cincinnati, Ohio. (Ty Wright/Bloomberg)

Key Points

• Fifth Third Bancorp will acquire Comerica in an all-stock deal valued at $10.9 billion, creating the ninth largest U.S. bank.
• Comerica shareholders will receive 1.8663 Fifth Third shares per Comerica share, a 17% premium to Comerica’s Friday closing price.
• Bank mergers have reached a four-year high, with 118 tie-ups worth $23.3 billion announced this year, driven by regulatory changes.

Ohio lender Fifth Third Bancorp said Monday it has agreed to acquire Comerica , a Dallas-based firm that has come under pressure in recent months from investors and analysts for lagging financial performance, in a deal that is set to create the ninth-largest U.S. bank by assets.

The all-stock deal, valued at $10.9 billion, is the largest bank tie-up of the year. It underscores how the Trump administration’s business-friendly financial regulators have emboldened the nation’s more than 4,000 banks to make deals to compete with larger rivals.

The deal marks a victory for HoldCo Asset Management, an activist hedge fund that has a stake in Comerica and in July called on the firm to capitalize on an opportune regulatory climate for banks and sell itself.

On Monday, shares of Comerica surged 15% to $81.23 while Fifth Third’s stock slipped 1% after an initial jump.

Created with Highcharts 9.0.1Source: FactSetAs of Oct. 6, 4 p.m. ET

Created with Highcharts 9.0.1ComericaFifth ThirdOct. 3Oct. 6-5.0-2.502.55.07.510.012.515.017.520.0%

As standalone firms, Fifth Third and Comerica are the 20th- and 34th-largest banks, respectively, in the U.S. Together they will have some $288 billion in assets. The deal is expected to close in the first quarter of 2026, the companies said.

Comerica shareholders will receive 1.8663 Fifth Third shares for each Comerica share, representing $82.88 per share as of Fifth Third’s last closing price—a 17% premium to Comerica’s closing price on Friday.

In a note to clients on Monday, Raymond James analysts said the terms “appear fair as Fifth Third’s premium currency allows it to realize minimal, if any, [tangible book value] dilution.” At the same time, “the premium paid was likely necessary,” as there were likely other lenders interested in merging with Comerica, the analysts wrote.

For Comerica, the acquisition marks the end of nearly two centuries as a standalone firm that itself has gone through a series of deals. It started out in 1849 as the Detroit Savings Fund Institute, an early provider of savings accounts that paid interest to customers. Now, Comerica is poised to join one of the largest lenders in Ohio.

On Monday, analysts were generally in favor of what the deal means for investors, while noting that a big deal like this carries execution risks and the possibility that competitors could step in to poach talent.

Steven Alexopoulos, an analyst at TD Cowen, wrote that the deal’s financial terms mark “one of the most financially attractive bank transactions that we’ve seen in decades.”

Alexopoulos cited expected growth to Fifth Third’s per-share earnings and estimated that, when cost savings are accounted for, it will be among the most efficient banks in the country with a 53% efficiency ratio.

The deal is the latest in a series of bank mergers this year. Pinnacle Financial Partners and Synovus Financial are set to combine through a merger of equals, while PNC Financial Services Group said last month it would buy the privately held Colorado lender FirstBank for $4.1 billion. Last week, Huntington Bancshares received regulators’ approvals to acquire Veritex Holdings, a deal announced in July.

A recent analysis by S&P Global Market Intelligence, before Monday’s deal, listed 118 bank tie-ups worth a combined $23.3 billion in value that have been announced in the U.S. in 2025.

That was already pace to surpass last year’s 126 deals and already topping its $16.3 billion in combined value.

Trump-appointed regulators have scrapped stringent merger guidelines as well as pushed for faster reviews for bank deals, a combination prompting more interest in M&A. Expectations of lower interest rates, too, and stock prices at record highs have added to corporate optimism.

Investors are now sizing up new potential targets and buyers.

In August, Jefferies analysts said they view Zions Bancorp , Eagle Bancorp , and BOK Financial as potential targets, adding that Cullen/Frost Bankers of Texas and East West Bancorp of California appeared well-positioned to acquire.

Write to Rebecca Ungarino at rebecca.ungarino@barrons.com and Elsa Ohlen at elsa.ohlen@barrons.com