First Citizens unaware of any regulatory issues as MOE remains pending

First Citizens BancShares Inc. executives said they are not aware of outstanding regulatory issues regarding its delayed merger of equals with CIT Group Inc.

The Street and equity analysts are scratching their heads as the banks wait on Federal Reserve Board approval for the MOE that was announced on Oct. 16, 2020. The companies have pushed back the expected closing date multiple times and recently extended their merger agreement to March 1, 2022.

On the company's third-quarter earnings conference call, management addressed an unsigned letter to the Fed that alleged multiple antitrust violations by First Citizens, which was reported last week by S&P Global Market Intelligence.

CFO Craig Nix responded to an analyst's question about the letter by noting that it was sent in mid-February.

"Since then and before then, we have been in constant communication with our regulators, two of which have approved the transaction while this letter was out there. In terms of the Fed, I'm not going to speculate on how they view it, but we have addressed any issues they had in general, not necessarily specific to that letter since that time. And we're unaware of any problems out there or issues with our application," Nix said on the call.

First Citizens has stayed in "regular touch" with the Fed and responded to all their questions, Chairman and CEO Frank Holding Jr. said. The company has not been provided a timeframe on when the Fed will make their decision, he said.

"We understand and share the frustration regarding the length of time that has been required to obtain the necessary approvals for this merger, but this process can require patience," he said.

First Citizens and CIT's MOE is not the only bank deal caught up in the backlog of applications with the Fed.

Webster Financial Corp. does not "have clear line of sight to timing" regarding Fed approval of its MOE with Sterling Bancorp, Chairman, President and CEO John Ciulla said on the bank's third-quarter earnings call. The companies announced their MOE on April 19.

Similarly, Old National Bancorp executives said on the company's third-quarter earnings call they are stuck "in the queue" as the company awaits Fed approval of its MOE with First Midwest Bancorp Inc. that was announced on June 1.