Citigroup and Wells Fargo are currently the only U.S. megabanks with room under the 10% national deposit cap to acquire a large regional bank, but neither has taken action despite the opportunity. Wells Fargo CEO Charlie Scharf has indicated openness to a 'transformative deal,' while Citigroup CEO Jane Fraser has stated the bank's focus remains on organic growth rather than mergers and acquisitions [1]. Regulatory barriers have loosened, allowing large banks to consider buying other lenders, including those with over $100 billion in assets. However, JPMorgan Chase and Bank of America are excluded from such deals due to their existing market share [1].
The value of North American bank mergers dropped by more than half in the first six months of 2026, according to EY, reflecting a cautious approach in the current environment [1]. Bain projects that by 2030, the number of regional banks could shrink from 49 to as few as 30, and one to three new $1 trillion-plus megabanks could emerge as consolidation accelerates [1].
Industry experts note that, after years of regulatory restrictions, both Citigroup and Wells Fargo have cleared key hurdles and are now in a position to pursue growth. A large acquisition could provide Wells Fargo or Citigroup with thousands of branches and billions in deposits, with Citigroup especially benefiting from cheaper funding due to its relatively small U.S. branch network of about 650 locations [1]. For Wells Fargo, an acquisition would add scale and cost-cutting opportunities [1].
Analysts such as Chris McGratty from KBW emphasize the urgency for consolidation, stating, 'There's a massive race for scale, and the shot clock is running. If you want to do something, this is the time to do it' [1]. Despite over 4,200 banks in the U.S., only a handful are considered viable targets for Wells Fargo or Citigroup, based on size, branch network compatibility, cultural fit, and deposit quality [1].
CONCLUSION
Wells Fargo and Citigroup are uniquely positioned to pursue major regional bank acquisitions as regulatory barriers have eased, but both have yet to act. With industry consolidation expected to accelerate, analysts highlight a narrowing window for transformative deals that could reshape the U.S. banking landscape.