PNC, PA's top bank, to buy Cleveland's troubled Nat City for $2.23/share

PNC, Pennsylvania's biggest bank, to buy Cleveland's troubled National City Corp. for $5.2 billion, or $2.23 a share. PNC says that would make it the fifth-largest U.S. bank (after Bank of America, JPMorgan Chase, Wells Fargo-Wachovia, and Citigroup) with the fourth-largest branch network (at least until duplicate branches in Western PA and Ohio are shut and thousands laid off to cut costs.) UPDATE: PNC shares rise $3 in early trading to around $59.

  PNC's bid would allow the Cleveland Federal Reserve, both banks' regulator, to avoid a costly NatCity bailout. But PNC is using U.S. Treasury TARP program financing, and presumably writing off a lot of NatCity losses, so taxpayers have a major investment.

  PNC has a branch network and a few thousand workers, NatCity has a corporate loan office and a distressed-companies business in the Philly area. Expect job cuts in Cleveland -- not here. PNC statement here.

  UPDATE: Why is PNC the only Pennsylvania (or mid-Atlantic, or midwestern) bank that looks like it'll make it to the major leagues in the giant financial institutions slamdown? "Because the government had them under lockdown" after 2004, since federal investigation of the bank's attempts to put investment and loan losses off its balance sheet forced CEO Jim Rohr to tighten financial controls, says a bank executive. "They couldn't buy any of the subprime loan junk. That's why they're still here!"