Atlantic Union and Sandy Spring: A Strategic Merger for Regional Banking

Atlantic Union Bankshares Corporation (AUB) and Sandy Spring Bancorp, Inc. (SASR) have received regulatory approvals from the Federal Reserve Bank of Richmond to complete their previously announced all-stock merger. This strategic move will create a formidable regional banking entity with an enhanced market presence across Virginia and Maryland. The merger is expected to close by the end of the third quarter of 2025, subject to customary closing conditions, including regulatory approvals and shareholder approvals.

The combined entity will have pro forma total assets of $39.2 billion, total deposits of $32.0 billion, and gross loans of $29.8 billion, based on financial data as of September 30, 2024. This merger will significantly enhance the combined company's presence in Northern Virginia and Maryland, making it the largest regional bank headquartered in the lower Mid-Atlantic.

The strategic benefits of this merger for both AUB and SASR are numerous. The combined entity will approximately double its wealth business by increasing assets under management by more than $6.5 billion. The addition of 53 branch locations will provide access to new markets and customer segments, further diversifying revenue streams. Additionally, the merger will allow the combined company to better serve its clients and communities, while also creating long-term shareholder value.

The merger is expected to generate significant synergies and cost savings, primarily through operational efficiencies and network integration. By consolidating departments and streamlining supply chains, the merged entity can eliminate redundancies and achieve substantial savings. The combined company will have a larger procurement power, allowing it to negotiate better terms with suppliers and vendors, resulting in cost reductions. The merger will also provide opportunities for cross-selling and expanded market access, which can lead to increased revenue.

The combined entity's enhanced market position will enable it to better compete with larger national banks and manage rising technology and compliance costs. The merger's progression despite the challenging regulatory environment for bank M&A signals strong fundamentals and regulatory confidence in the combined entity's stability.

In conclusion, the merger between Atlantic Union Bankshares Corporation and Sandy Spring Bancorp, Inc. is a strategic move that will create a preeminent regional bank with a strong presence in the Mid-Atlantic region. The combined entity's enhanced scale, diversity in the market, and capabilities will solidify its competitive position and enable it to better serve its customers and communities, while also creating long-term shareholder value. The merger is expected to generate significant synergies and cost savings, further strengthening the combined entity's financial health and prospects.