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Retirement Plans

SunTrust, BB&T merger would combine $17.4 billion in retirement assets

SunTrust Banks, Atlanta, and BB&T, Winston-Salem, N.C., agreed to an all-stock merger Thursday, creating a financial-services giant with about $17.4 billion in retirement plan assets.

No details on how the retirement plans will be affected by the merger were immediately available. The deal, which will create the sixth-largest U.S. bank based on assets and deposits, is expected to close in the fourth quarter, the companies said in a joint news release.

BB&T has one qualified defined benefit plan that is open to new hires. In 2017, BB&T contributed $479 million to the plan. The pension fund had assets of $6.3 billion and liabilities of $4.9 billion as of Dec. 31, 2017, for a funded status of 127.7%, according to its most recent 5500 filing. The BB&T Corporation 410k Savings Plan had assets of $4.6 billion as of Dec. 31, 2017.

The SunTrust Banks Inc. 401(k) Plan had $3.3 billion in assets as of Dec. 31, 2017, according to its latest Form 5500 filing. As of that date, investment assets were $2.9 billion in Vanguard mutual funds, $321 million in SunTrust common stock and $2.7 million in Federated Prime Obligations mutual fund.

The SunTrust Banks Inc. Retirement Plan, a cash balance plan frozen in December 2011, had assets of $3.1 billion as of Dec. 31, 2017, and was 115.6% funded. Its asset allocation is 49% stocks and 51% investment grade debt.

RBC Capital Markets served as financial adviser to BB&T and Goldman Sachs advised SunTrust in the transaction. BB&T Chairman and Chief Executive Officer Kelly S. King will serve those roles for the combined company while SunTrust Chairman and CEO William H. Rogers, Jr. will serve as president and chief operating officer.

The combined company, with assets of $422 billion, will operate under a new name and be headquartered in Charlotte, N.C. It will have significant operations in Winston-Salem and Atlanta, the companies said in the announcement.