M&A: PNC sells servicing unit to BoNY-M
The PNC Financial Services Group, which came to international attention when it took over Riggs Bank in the wake of the allegations that the latter's due diligence processes were defective, is to sell PNC Global Investment Servicing to Bank of New York Mellon for USD2,300 million in cash.
PNC describes the unit as a "provider of processing, technology and business intelligence services to asset managers, broker-dealers, and financial advisers worldwide."
According to a statement from PNC, "Upon completion of the sale, PNC expects to report an after-tax gain of approximately USD500 million and an increase in Tier 1 common capital of approximately USD1,600 million after the release of capital of USD1,100 million primarily related to goodwill and other intangible assets. As a result, on a pro forma basis, PNC's Tier 1 common capital ratio at 31 December, 2009 would have increased by approximately 70 basis points to an estimated 6.7 percent."
The transaction is estimated to be completed in the third quarter of 2010, subject to regulatory approvals and certain other closing conditions.
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