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DEAL COPS. New York Community Bancorp’s (NYCB.N) $2.6 billion acquisition of Flagstar Bancorp (FBC.N) isn’t usually the kind of deal that draws scrutiny in Washington. But Senate Banking Chairman Sherrod Brown is part of a group of Democrats who want regulators to crack down on consolidation. That gives pause to the slew of regional banks that have been in M&A mode.
These deals often make financial sense . Bancorp and Flagstar are among the medium-sized firms that have struggled in the near-zero interest rate environment. The combined company, with $87 billion in assets, would help them better compete against giants like JPMorgan (JPM.N) or fintech upstarts.
That’s why there has been a rash of tie-ups after a pause post-2008 financial crisis. Last year, First Citizens BancShares (FCNCA.O) announced a $2.2 billion acquisition of CIT Group (CIT.N) while PNC Financial Services (PNC.N) is buying the U.S. business of Spain’s BBVA (BBVA.MC) for $11.6 billion read more .
Last September, the Justice Department under Donald Trump signaled it could loosen bank merger reviews. With Democrats now in charge , regional lenders can expect more time under the microscope. (By Gina Chon)
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