Sheffield Will Likely ‘Forge Ahead’ in Wake of Parent Company’s Merger With SunTrust

Details are scarce regarding a potential combination of the powersports units of BB&T Corp. and SunTrust Banks, in the wake of the banks’ $66 billion merger announced today. But BMO Capital Markets Analyst Gerrick Johnson speculated that BB&T subsidiary Sheffield Financial would “forge ahead” with its retail financing of brands such as Polaris, Can-Am, and Mahindra Roxor.

Sheffield finances snowmobiles, ATVs, side-by-sides, motorcycles, and personal watercraft. Meanwhile, SunTrust’s powersports financing is managed by subsidiary LightStream, which provides unsecured consumer loans for motorcycles, boats, and RVs.

“I don’t know if the two would get folded in together for synergy opportunities,” Johnson said. “That’s typically what happens in a merger.”

Lightstream, Sheffield, and BB&T declined to comment.

Though the companies do not break down powersports originations in the total portfolio, LightStream originated $2 billion of loans in 2018. BB&T noted in a fourth-quarter 2018 presentation that its indirect loan growth was “impacted by [a] seasonal slowdown in Sheffield.” The presentation indicated $5.9 billion in average loans for the quarter for Sheffield and a unit labeled “CEC.”

The merged company, which will operate under a new name and brand, will have $301 billion in loans and serve more than 10 million U.S. households. The merger will make the new entity the sixth largest bank in the U.S. by assets, at $442 billion.

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