SunTrust Banks Inc. announced it is buying National Commerce Financial Corp. of Memphis, Tenn., in the industry's second megamerger in less than a week. The late Sunday deal is valued at almost $7 billion in cash and stock and will create the seventh-largest US bank. It gives SunTrust of Atlanta 1,723 full-service offices in 11 states, plus the District of Columbia. The merger follows a reported bidding war between SunTrust and Fifth Third Bancorp of Cincinnati. Last Wednesday, Charter One Financial Corp. was acquired by Royal Bank of Scotland for $10.5 billion in cash.
Citigroup agreed to pay $2.65 billion to investors who bought stock through its brokerage division in WorldCom Inc. before the latter's July 2002 bankruptcy filing - the largest in US history. Citigroup chief Charles Price said the move was made to "eliminate the uncertainties, burden, and expense of further protracted litigation." In settling various class-action suits, Citigroup admits to violating no laws. WorldCom, now known as MCI, emerged from bankruptcy April 20, having shed almost $35 billion in debt. Citigroup also said it is setting aside $6.7 billion to help cover potential claims related to its liability in the collapse of Enron Corp - over and above settlements already reached as a result of federal investigations into the matter.
IBM was scheduled to roll out a new software technology as the Monitor went to press that will allow large corporations to bypass Microsoft operating systems with "client middleware" that runs on desktop PCs and hand-held devices, the Financial Times and New York Times reported. With the new software, the world's largest maker of computers said it is attempting to address cost and security considerations that are major priorities for corporate customers. Simultanously, leading technology companies such as Motorola and Adobe Systems were expected to announce plans for products that support the new IBM software, the Financial Times said.