Riggs National Corp., which last month admitted to helping some customers hide millions of dollars, said Monday that its $779-million agreement to be acquired by PNC Financial Services Group Inc. had collapsed.
The deal unraveled after PNC slashed its July offer by at least 17% to $20.15 a share and Washington-based Riggs sued, saying it was seeking new suitors. PNC also refused to complete the takeover unless Riggs, led by Chairman and Chief Executive Robert Allbritton, first settled at least one lawsuit and set aside funds for other litigation.
The development throws into doubt the future of Riggs, a Washington institution that helped finance the U.S. government's 1867 purchase of Alaska from Russia and became the bank of choice for many embassies and diplomats. Riggs, which already has paid at least $25 million in fines and agreed to close its international operations, lost more than half its market share for deposits in the District of Columbia through June.
Riggs shares dropped $1.40, or 6.6%, to $19.85 on Nasdaq, the stock's biggest decline since October 2002. Shares of Pittsburgh-based PNC, Pennsylvania's biggest bank, climbed 38 cents to $54.58 on the New York Stock Exchange.