December 20, 2008

M&T Bank has agreed to buy Baltimore's Provident Bankshares for stock valued at $401 million in a deal that will give the merged company a leading market position in Maryland and an expanded presence in Virginia.

The sale continues the consolidation of the local banking industry, following Capital One Financial's agreement to buy Chevy Chase Bank and the sale of Wachovia to Wells Fargo. It also plucks one of the largest companies headquartered in Baltimore. The companies, which together employ more than 4,000 people in Maryland, said they would keep all customer-facing employees but have not yet decided how many other jobs would be cut.

Regulators and shareholders still must sign off on the deal, which M&T hopes will close in the second quarter.The deal would give Buffalo-based M&T about 250 branches in Maryland, about 60 branches in Virginia and about eight in the District. It would rank as the second-largest bank in Maryland as measured by deposits, behind Bank of America.