Fifth Third's $11 Billion Comerica Acquisition: Implications for Investors
Last month, Fifth Third Bancorp, headquartered in Cincinnati, made headlines by announcing an all-stock acquisition of Dallas-based Comerica Inc. valued at $10.9 billion. This major move signals renewed momentum in regional bank consolidation as the Trump administration accelerates support for mergers and acquisitions in the financial sector.
The combined institution will become the ninth-largest bank in the United States, holding approximately $288 billion in assets. Through this acquisition, Fifth Third secures the top retail deposit position in Michigan and strengthens its presence in high-growth markets such as Texas.
Strategic Impact
After the deal closes, the merged bank’s lending portfolio will be heavily weighted toward commercial real estate and commercial and industrial loans, comprising around two-thirds of total loans. The organization will also enhance its fee-based revenue streams through areas like commercial payments, asset management, and wealth management.
Comerica’s Recent Challenges
Before the merger, Comerica had lost a significant contract with the U.S. Department of the Treasury related to the Direct Express program, which distributed federal benefits via prepaid cards.
Last year, Comerica lost a contract with the U.S. Department of Treasury managing the agency's Direct Express program, where it helped the agency distribute federal benefits through pre-paid cards.
The contract had contributed approximately $3 billion in non-interest-bearing deposits—an inexpensive funding source the bank had leveraged to support loan origination and securities purchases. Its loss was a financial setback but created an entry point for Fifth Third to gain a broader federal service relationship.
Market Outlook
This acquisition reflects a broader wave of consolidation among regional banks seeking scale and efficiency advantages. With this transaction, Fifth Third strengthens its competitive position and diversifies its business operations while signaling continued optimism in the U.S. banking sector under evolving regulatory support.
Author’s Summary: Fifth Third’s acquisition of Comerica creates a top-10 U.S. bank, expanding its Midwest and Texas presence while boosting its loan and fee-based business mix for stronger long-term growth.