America’s banking industry is consolidating faster than at any point in the past three decades. According to a Financial Times analysis released Sunday (Nov. 2), U.S. regulators are approving bank mergers at the quickest pace since at least 1990, marking a dramatic shift from the delays and uncertainty that characterized the previous administration’s approach.
The average approval time for a bank merger has dropped to just four months in 2025 — down from nearly seven months under the Biden administration, according to S&P Global data. This acceleration is part of the Trump administration’s push to streamline regulatory processes, reviving deal-making activity among America’s 4,000-plus regional banks.
Overview: A Snapshot of the 2025 Bank M&A Landscape
| Key Metric | 2025 Figures (Year-to-Date) |
|---|---|
| Number of Bank Mergers Closed | ~150 deals |
| Total Value of Mergers | $45 billion |
| Average Approval Time | 4 months |
| Previous Average (2020–2024) | 6–7 months |
| Largest Deal | Capital One’s $35.5 billion acquisition of Discover |
| Regulatory Environment | Pro-merger, accelerated under Trump administration |
Faster Approvals Unlock a Wave of Consolidation
The quicker approval process has effectively unclogged a regulatory bottleneck that had discouraged dealmakers for years. The Trump administration’s pro-business approach is encouraging mergers among regional and mid-tier banks, with dealmakers reporting higher confidence in obtaining regulatory clearance.
Close to $24 billion in new bank mergers have been announced in the last few months alone, putting 2025 on track to become the busiest year for bank M&A since 2021.
“The deals that have been announced all would have been approved by the prior administration,” said John Esposito, Global Co-Head of Morgan Stanley’s Financial Institutions Division. “What is different is the time of approval.”
By speeding up merger timelines, regulators have made it easier for regional banks to scale and compete with larger peers. As a result, the merger pipeline that once spanned a year or more can now be completed in under six months.
Major Deals Defining 2025’s M&A Momentum
This wave of deal activity is producing larger and more strategic mergers, signaling renewed confidence in the sector.
Key Transactions So Far
| Acquirer | Target | Deal Value | Status |
|---|---|---|---|
| Capital One | Discover | $35.5 billion | Approved after 12 months |
| Fifth Third Bank | Comerica | $10.9 billion (all-stock) | Approved |
| PNC Financial | FirstBank (CO) | $4.1 billion | Approved |
| Truist Financial | Pacific Western Bank | $3.6 billion | Pending Review |
The Fifth Third–Comerica deal is particularly transformative, creating a “super regional bank” with over $100 billion in assets and a multiregional footprint capable of competing with national giants in payments, commercial lending, and wealth management.
“Fed Vice Chair Michelle Bowman’s comments have hinted at lighter oversight for smaller banks, which could open the door to faster consolidation,” PYMNTS reported in October.
Why Regulators Are Changing Course?
Several factors are driving the shift toward faster and more frequent merger approvals:
- Economic Efficiency and Scale
Regulators see consolidation as a way for banks to achieve scale, streamline operations, and enhance digital and payments infrastructure — especially amid rising costs and cybersecurity demands. - Regional Bank Stability
Following the turbulence of recent years, regulators have encouraged well-capitalized banks to acquire smaller, less stable institutions. This has strengthened the system’s overall resilience. - Policy Shift Under the Trump Administration
The new administration has prioritized regulatory simplification and faster deal clearance, positioning M&A as a mechanism for economic growth and competitiveness. - Market Pressures and Competition from FinTechs
With FinTech challengers and Big Tech players increasingly entering financial services, traditional banks see mergers as a strategy to consolidate market share and modernize operations.
“This is not deregulation — it’s modernization,” said Daniel Harper, Managing Director at Keefe, Bruyette & Woods. “Banks need to be able to respond to new competitors at speed, and that requires scale.”
Historical Comparison: Bank M&A Over the Past 35 Years
| Decade | Average Approval Time | Regulatory Environment | Typical Deal Size |
|---|---|---|---|
| 1990s | 6–8 months | Moderate oversight (post-S&L crisis) | $500M–$2B |
| 2000s | 5–6 months | Light regulation, pre-2008 crisis | $1B–$10B |
| 2010s | 7–9 months | Tighter Dodd-Frank oversight | $500M–$5B |
| 2020–2024 | 6–7 months | Heightened scrutiny under Biden | $5B–$20B |
| 2025 | 4 months (fastest since 1990) | Accelerated approvals under Trump | $10B+ “super regional” deals |
Impact on Regional Banks and Competition
The acceleration in merger approvals is reshaping the U.S. banking landscape.
- Regional banks are rapidly scaling into super regionals, enabling them to compete more directly with national banks such as JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup.
- Midsize lenders see M&A as a pathway to digital modernization — pooling resources to invest in payments, cybersecurity, and AI infrastructure.
- However, the trend has also raised concerns about reduced competition, particularly in local markets where consolidation could limit consumer choice.
“The balance regulators must strike is between efficiency and diversity,” said Laura Montgomery, Senior Analyst at Cornerstone Advisors. “The speed is welcome, but we’ll need to watch how it affects smaller community banks.”
Policy Outlook: What’s Next for Bank M&A?
Looking ahead, regulators are expected to maintain the accelerated approval pace through 2026, with additional guidance anticipated from the Federal Reserve and Office of the Comptroller of the Currency (OCC).
Experts suggest that:
- Deal volume could surpass $60 billion in 2026 if current trends hold.
- Smaller community banks may face increased pressure to merge for survival.
- Digital and payments technology integration will remain a primary motivation behind deals.
At the same time, consumer advocates are calling for continued oversight to ensure mergers do not reduce financial inclusion or branch access in underserved areas.
FAQs
What’s driving the recent surge in bank merger approvals?
A shift in regulatory priorities under the Trump administration, emphasizing faster deal processing and economic efficiency.
How fast are approvals being processed now?
On average, the approval time is four months, which is the quickest in 35 years.
What’s the total value of bank mergers so far in 2025?
Roughly $45 billion, with over 150 deals closed year-to-date.
Which merger was the largest this year?
Capital One’s $35.5 billion acquisition of Discover is the largest, which took 12 months to clear due to heightened scrutiny.
What does this mean for smaller banks?
Community and regional banks may seek mergers to achieve scale, reduce costs, and compete more effectively with national players.