PNC reportedly in talks to buy BBVA's U.S. operations

PNC Financial Services Group in Pittsburgh is reportedly in discussions to buy the U.S. operations of Spain's Banco Bilbao Vizcaya Argentaria.

The parties are in “advanced talks" for PNC to buy Birmingham, Ala.-based BBVA USA for roughly $11 billion, sources told the Wall Street Journal. If a deal is struck, it would be among the biggest bank combinations since the financial crisis of 2008 and 2009, creating a company with about $563 billion of assets and branch network stretching from Massachusetts to California.

BBVA significantly expanded its U.S. operations in 2007 when it acquired Compass Bancshares in Birmingham. The U.S. arm operated under the name BBVA Compass until last year, when it was rebranded as BBVA USA.

The $462 billion-asset PNC has been rumored to be eyeing a big acquisition since it divested its 22.4% stake in the asset manager BlackRock earlier this year. After taxes, the stock sale netted PNC about $5 billion.

Speaking at an investor conference in June, PNC Chairman and CEO William Demchak said the company would be open to a large deal that would boost its assets to more than $700 billion. Though a deal for BBVA would not take PNC to that level, it would make PNC the nation's fifth-largest retail bank, vaulting it over the $499 billion-asset Truist Financial — created through last year's merger of BB&T and SunTrust Banks — and the $541 billion-asset U.S. Bancorp.

A PNC and BBVA combination, unlike the BB&T-SunTrust merger, would have little geographic overlap. About half of BBVA's 640 U.S. branches are in Texas, where PNC has no branch presence. BBVA also has about 170 branches in Florida, Arizona and California, three other states where PNC has no retail operations.

For PNC, the deal would be its first bank acquisition since it bought Royal Bank of Canada’s U.S. operations in March 2012 for $3.5 billion.