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FIRST CITIZENS BANCSHARES INC /DE/ 8-K Report, Material Agreement (Oct 20, 2020)

Filed October 20, 2020For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

First Citizens BancShares, Inc. (FCNCA) announced a significant strategic move on October 15, 2020, entering into a definitive Agreement and Plan of Merger with CIT Group Inc. (CIT). This transaction will be structured as a "first-step merger" where a subsidiary of First Citizens merges with CIT, followed by a merger of CIT into First Citizens Bank & Trust Company, and finally a merger of CIT Bank into First Citizens Bank & Trust Company. This complex structure aims to consolidate the entities and their banking operations. The merger consideration for CIT common stockholders will be 0.06200 shares of First Citizens Class A common stock per share of CIT common stock, with cash paid in lieu of fractional shares. Preferred stockholders of CIT will receive newly created preferred stock series from First Citizens. The transaction, which has received unanimous board approval from both companies, is anticipated to close in the first half of 2021, subject to customary closing conditions and regulatory approvals. This merger represents a substantial step in First Citizens' growth strategy, creating a larger, more diversified financial institution.

Key Highlights

  • 1First Citizens BancShares (FCNCA) entered into a definitive Agreement and Plan of Merger with CIT Group Inc. (CIT) on October 15, 2020.
  • 2The transaction involves a multi-step merger process, ultimately consolidating CIT's banking operations into First Citizens Bank & Trust Company.
  • 3CIT common stockholders will receive 0.06200 shares of FCNCA Class A common stock per share of CIT common stock as merger consideration.
  • 4CIT preferred stockholders will receive newly created preferred stock series from FCNCA.
  • 5The merger has been unanimously approved by the Boards of Directors of both FCNCA and CIT.
  • 6The parties anticipate closing the transaction in the first half of 2021, subject to regulatory and shareholder approvals.
  • 7Key leadership roles in the combined entity are addressed, including Ellen R. Alemany, CEO of CIT, who will serve as Vice Chairwoman of First Citizens Bank & Trust Company post-merger.

Frequently Asked Questions

Each share of CIT Group Inc. common stock will be converted into the right to receive 0.06200 shares of First Citizens BancShares, Inc. Class A common stock. Cash will be paid in lieu of fractional shares.

The parties anticipate that the transaction will close in the first half of 2021, subject to the satisfaction of customary closing conditions, including regulatory and shareholder approvals.

Existing CIT preferred stock (Series A and Series B) will be converted into newly created preferred stock series (Series B and Series C, respectively) of First Citizens BancShares, Inc. These new series will have rights, preferences, and privileges that are not materially less favorable than the original CIT preferred stock.

The Board of Directors for the combined company and the combined bank will consist of 14 directors. Eleven will be from the current First Citizens BancShares Board, and three will be selected from the current CIT Board, including CIT's CEO, Ellen R. Alemany, who will also serve as Vice Chairwoman of First Citizens Bank & Trust Company.