Cleveland, OH - PNC Financial Services Group Inc. which is Pennsylvania's largest bank, plans to buy National City Corporation for about $5.2 billion in stock with funds from the U.S. Treasury.
PNC will pay $2.23 a share, 19% less than National City's closing price Thursday, to create the fifth-largest U.S. bank by deposits, the Pittsburgh-based lender said Friday in a statement.
Cleveland-based National City has been hit hard over the past year by the downturn in the mortgage market. Earlier this week, the Cleveland-based bank posted a quarterly loss of $5.15 billion, or $5.86 per share.
PNC says it will also receive a $7.7 billion investment from the government, under its $750 billion bailout plan.