National City Next to Go

Another one bites the dust. After Washington Mutual and Wachovia Bank (WB), it’s now the turn of Ohio’s largest bank National City Corp. (NCC) to be taken over. Unable to turn the tide after being lashed by the subprime crisis, National City is now set to be acquired by PNC Financial Services Group Inc. (PNC), which in turn is Pennsylvania’s biggest bank.

The deal has been struck at $5.2 billion in stock and has the backing of funds from the U.S. Treasury. PNC will shell out $2.23 a share, 19% less than National City's closing price on Thursday. The merger will create the fifth-largest bank in the U.S.
The news, however, did little to lift the spirit of National City investors as the stock has plummeted by 20% since the morning. PNC has gained 3.74% and is trading at $59.04.

Read the full analyst report on NCC