NEW YORK, Dec 8 (Reuters) – Huntington Bancshares will cut some jobs at Texas-based Cadence Bank after its $7.4 billion acquisition, which expands the Ohio lender’s presence in what it sees as one of the three most attractive U.S. markets, Huntington’s chief executive said.
Huntington, based in Columbus, Ohio, did not disclose the number of jobs it plans to eliminate at Houston-headquartered Cadence, which employs about 5,800 people. It agreed in late October to buy Cadence in an all-stock deal that is expected to close in the first quarter.
“There’ll be more layoffs,” CEO Stephen Steinour told Reuters in an interview. “We want to be transparent. So right away we communicate, there are going to be impacts.”
Over time, Huntington, which had more than 20,000 staff before the deal, is likely move some roles from other regions to Texas as it focuses on the growth market.
“As we looked at where might we like to grow, it was the Carolinas – North and South – and Texas,” Steinour said, three of the top five fastest-growing states in the country.
The bank is opening 55 branches across North and South Carolina, Steinour said.
Huntington reduced over 60 jobs at Texas bank Veritex after its a $1.9 billion all-stock July acquisition, which closed in October.
Huntington’s acquisitions underscore a broader push by regional lenders to expand and compete with larger banks.
The Cadence purchase will create a bank with assets of $276 billion, pushing Huntington into a regulatory classification known as Category 3 that imposes more stringent rules, including for capital and liquidity.
Eventually, Huntington expects to create more jobs in Texas.
“Over time, we’ll add jobs there and the same thing applies for the number of the markets that we will be in with Cadence,” said Brant Standridge, who leads consumer and business banking at Huntington.
The Cadence deal will help the bank finance more energy companies, Steinour said. Auto financing is another growth opportunity for the lender in Texas, he said.
BULLISH ON ECONOMY
The bank’s priority is to grow its existing business, and loans have grown 9% so far this year, the CEO said.
“We’re bullish on the economic environment,” he said. “Things have slowed down a bit… But our customers are doing well, we’re doing well. The industry is doing well,” he said.
“We don’t see credit issues emerging from any of our competitors at this point. And so there’s a reasonable optimism about economic growth next year.”
(Reporting by Saeed Azhar and Lananh Nguyen; Editing by Cynthia Osterman)
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