Regions Financial Corp. has completed its sale of Morgan Keegan & Co. Inc. and related affiliates to Raymond James Financial Inc. for about $1.2 billion.
Regions’ trust and institutional investment management businesses are not included in the sale and will operate within Regions’ Wealth Management organization.
Regions President &d CEO Grayson Hall said the sale fits Regions’ plan to expand its market share.
Regions and Raymond James will continue to work closely to ensure that customers with accounts at Morgan Keegan and Regions Bank continue to receive the same high level of service quality from both companies.
Regions began shopping the brokerage after an expensive series of civil settlements that stemmed from irregular practices by investment brokers, including the selling of high-risk securities under the guise of low-risk instruments.
Settlements included one for slightly more than $200 million with Mississippi and a handful of other Southeastern states. It’s believed that Morgan Keegan’s questionable practices cost Mississippi investors in the neighborhood of $50 million, according to the Secretary of State’s office.
Regions and Raymond James had previously announced a purchase price of $930 million with a $250 million pre-closing dividend to be paid to Regions by Morgan Keegan, generating total proceeds to Regions of approximately $1.2 billion. In lieu of a pre-closing dividend, the companies have agreed to increase the purchase price by the same amount, resulting in the same total proceeds to Regions of approximately $1.2 billion.
Regions Financial, with $127 billion in assets, serves customers in 16 states across the South, Midwest and Texas, and through its subsidiary, Regions Bank, operates approximately 1,700 banking offices and 2,100 ATMs. It is the market leader in Mississippi.
Raymond James is a Florida-based diversified holding company providing financial services to individuals, corporations and municipalities through its subsidiary companies. Its four principal wholly owned broker/dealers, Raymond James & Associates, Raymond James Financial Services, Raymond James | Morgan Keegan and Raymond James Ltd., have approximately 6,500 financial advisers serving 2.4 million accounts in 2,600 locations throughout the United States, Canada and overseas.