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Stock Analyst Update

Mergers Put BB&T, Huntington in the Slow Lane

Investors pause over acquisitions in low-growth markets.

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Regional banks BB&T (BBT) and Huntington Bancshares (HBAN) announced Monday that they are bulking up in slow-growth markets, a questionable strategy that has left some shareholders scratching their heads.

BB&T's shares were off about 5% for most of the day after the company said it would buy West Virginia's One Valley Bancorp (OV) for $1.2 billion in stock. Huntington's shares fared a little better after the Ohio bank's announcement that it will acquire Empire Banc Corporation of Traverse City, Mich., in a stock deal valued at $138 million.

Laura Pavlenko Lutton does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.