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Pittsburgh based regional bank PNC (NYSE:PNC) announced Friday morning it is acquiring Cleveland based regional National City Bank (NCC) for $5.5 billion. For each share of NatCity common stock, NatCity shareholders will receive 0.0392 per share (about $2.23 a share) of PNC common stock. The merger will make PNC the fifth largest bank by deposits, with a $180 billion core deposit base.

PNC is selling $7.7 billion equity to the Treasury as part of the TARP that has allocated injecting $125 billion of government money into the nation’s largest banks. PNC’s acquisition of

NatCity confirms the true purpose of the TARP is to use taxpayers’ money for bank consolidation, not for consumer and small business lending.

Treasury promoted bank mergers create less competition for consumer deposits along with higher fees, creating even more economic pain for consumers.

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Source: Treasury Uses TARP for PNC to Acquire National City