Santander talks with US bank fail

TALKS between US bank M&T and Santander over a $7.14bn (£4.5bn) merger of their US operations “are no longer on” a source close to the deal has told City A.M.

The negotiations over a merger between M&T and Santander-owne Sovereign Bank collapsed on Thursday. The deal also has implications for Allied Irish Bank (AIB), M&T’s largest shareholder.

A deal would have seen the merged bank come under the control of M&T chief executive Robert Wilmers with Santander taking a majority stake in the combined entity. That would have seen Santander buy AIB’s 22.5 per cent stake in M&T helping AIB raise $1.61bn towards the $9.9bn it desperately needs to raise by the end of December to meet new bank rules.