8-KLeadership ChangesAcquisitions & DispositionsFinancial Events+3

FIRST CITIZENS BANCSHARES INC /DE/ 8-K Report, Acquisition Completed (Jan 4, 2022)

Filed January 4, 2022For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

First Citizens BancShares, Inc. (FCNCA) announced the completion of its merger with CIT Group Inc. on January 3, 2022. This significant transaction involved a two-step merger process, culminating in CIT Group Inc. and CIT Bank merging with First Citizens Bank & Trust Company. The merger consideration for CIT common stockholders was 0.06200 shares of First Citizens Class A Common Stock per share of CIT common stock, plus cash for fractional shares. This merger is expected to create a larger, more diversified financial institution, integrating the operations and customer bases of both companies. Investors should note the assumption of CIT's outstanding senior and subordinated notes by First Citizens, totaling over $2.6 billion in principal value across multiple series with varying interest rates and maturity dates. Additionally, the report details executive and director changes resulting from the merger, including the appointment of former CIT executives and directors to key positions within First Citizens.

Key Highlights

  • 1Completion of the merger between First Citizens BancShares, Inc. and CIT Group Inc. on January 3, 2022.
  • 2Shareholders of CIT Group Inc. received 0.06200 shares of First Citizens Class A Common Stock per share of CIT common stock, plus cash for fractional shares.
  • 3First Citizens Bank & Trust Company (FCB) assumed outstanding debt obligations of CIT Group Inc., including approximately $1.147 billion in 5.000% Senior Unsecured Notes due 2022 and other senior and subordinated notes totaling over $2.6 billion in principal.
  • 4New series of preferred stock (Series B and Series C) were created for First Citizens to replace CIT's preferred stock, with a non-callable period extended to January 4, 2027.
  • 5Former CIT executives Ellen R. Alemany (appointed Vice Chairwoman) and Marisa J. Harney (appointed Chief Credit Officer) have joined First Citizens' executive team with new employment terms and compensation arrangements.
  • 6Three former CIT directors, Ellen R. Alemany, Michael A. Carpenter, and Vice Admiral John R. Ryan, were elected to the First Citizens Board of Directors.
  • 7Financial statements of CIT Group Inc. and pro forma financial information will be filed by amendment within 71 days.

Frequently Asked Questions

This 8-K filing formally announces the completion of the merger between First Citizens BancShares Inc. and CIT Group Inc. This signifies the integration of the two companies, leading to a larger entity with expanded operations and customer base. Investors should pay attention to the exchange ratio for shares, the assumption of CIT's debt, and changes in executive and board leadership.

First Citizens Bank & Trust Company assumed significant debt obligations from CIT Group Inc. This includes several series of senior unsecured notes (maturing in 2022, 2023, 2024, and 2025) and subordinated notes (maturing in 2028 and 2029). The total principal balance of these assumed notes as of December 31, 2021, was over $2.6 billion.

CIT's outstanding preferred stock (Series A and Series B) was converted into newly created series of preferred stock for First Citizens (Series B and Series C, respectively). These new First Citizens preferred stocks have rights and preferences that are not materially less favorable than the original CIT preferred stocks, and their non-callable period was extended to January 4, 2027.

Former CIT executives Ellen R. Alemany and Marisa J. Harney have been appointed to executive positions at First Citizens, with specific employment agreements and compensation packages detailed in the filing. Additionally, Ellen R. Alemany, Michael A. Carpenter, and Vice Admiral John R. Ryan have joined the First Citizens Board of Directors, with details on their compensation and stock ownership provided.