Fifth Third Bancorp and Comerica Inc. have agreed to a merger that will create the ninth-largest bank in the U.S., with $288B in assets.

The all-stock transaction values Dallas-headquartered Comerica at $10.9B, according to an announcement by the regional banks. The deal is expected to close at the end of the first quarter.

The merger will significantly scale Cincinnati-based Fifth Third in the Southeast, Texas and California, as well as expand its operations in the Midwest. In an interview with CNBC’s Squawk Box on Monday, Fifth Third CEO Tim Spence said the bank plans to build 150 branches in Texas and “move into a top five position in Dallas, Houston and Austin.”

By 2030, the combined company expects that more than half of its branches will be located in the Southeast, Texas, Arizona and California.

“This combination marks a pivotal moment for Fifth Third as we accelerate our strategy to build density in high-growth markets and deepen our commercial capabilities,” Spence said in a statement.

The companies said the merger will provide the combined company with two separate $1B revenue streams: commercial payments and wealth and asset management.

The deal values Comerica at $82.88 per share, a 20% premium to the bank’s recent 10-day average. After the merger, Fifth Third shareholders will own roughly 73% of the combined company, and Comerica shareholders will own about 27%.

After the announcement, Comerica’s stock price jumped 15%, while Fifth Third’s briefly dipped before returning to about its opening price.

Spence acknowledged that the merger is taking place amid increased industry consolidation. There were 72 U.S. banking mergers and acquisitions announced in the first half of the year, representing a combined deal value of approximately $10.4B, according to consulting firm Ankura.

There were roughly $7.5B of transactions during the same period in 2024. Excluding the Capital One-Discover merger this spring, which accounted for $50.8B of the $58.3B total last year, the 2025 year-to-date value is a sizable increase over last year.

Plus, this year’s total deal count is on track to be the highest in more than five years.

“In an environment where merger approvals are coming faster, it builds our confidence,” Spence told Squawk Box. “Regulators believed we had the capacity to run a much larger bank.”