Regions Financial will acquire AmSouth Bancorp in a merger that would create a bank with nearly $140 billion in assets and market capitalization of about $26 billion, said officials Thursday. The two banking giants will merge in a $9.8 billion stock deal, creating the nations 10th largest bank, and hold nearly $100 billion in deposits..

Although the combined company will employ 37,000 people, the deal would reportedly save the company $400 million a year by closing 150 branches, and cutting as much as 10% of the total combined work force, about 3,600 employees will lose their jobs. The resulting bank will keep the Regions Financial name, and will have about 2,000 branches across Texas, and 16 other states across the South and Midwest regions. Jackson Moore, president/CEO of Regions, will become chairman of the combined entity. C. Dowd Ritter, chairman and president/CEO of AmSouth, will become president/CEO. Regions Financial will remain headquartered in Birmingham, Alabama.

Paragon Financial Corporation, a consolidator in the highly fragmented financial services marketplace, announced today that it reached an agreement to acquire eHOMECREDIT Corp. eHOMECREDIT of Garden City, NY, correspondent lender  and provider of residential mortgages, employs 200 people in their 35,000 sq ft branch office. Although eHOMECREDIT is licensed in 40 states and the District of Columbia, the majority of their loan origination business is generated in the states of New York, Massachusetts, Pennsylvania, and New Jersey. Under the merger agreement, Paragon will issue 1,000,000 shares of its Series G Preferred Stock (valued at approximately $7,000,000) to shareholders of eHOMECREDIT. The Series G Preferred Stock is automatically convertible into 100 million shares of Paragon's common stock upon the filing of an amendment to Paragon's articles of incorporation. 

"We view ourselves as the ideal partner for Paragon in their quest to consolidate the mortgage origination business. The addition of our 40 licenses will provide Paragon's mortgage origination business with the ability to originate loans in 47 states," said Phil Zegarelli, CEO of eHOMECREDIT. "We share Paragon's vision of the future of the mortgage origination business and believe the melding our complementary management talent, business processes, and geographic locations into a single operating entity should produce positive tangible synergy," he added.

"Upon the completion of this transaction, we will have a fully-functional national operating platform and demonstrate that we are consolidator in this highly fragmented industry," said Scott Vining, chief financial officer of Paragon.

Paragon Financial Corporation announced this week that they have agreed to terminate their planned merger with Shearson Home Loans, Inc., This termination was scheduled effective as of May 15, 2006. Under the agreement, Paragon will recoup 149,558,791 shares of its common stock and 79 shares of its Series F Preferred Stock. Since Shearson Home Loans, Inc. is a wholly owned subsidiary of Consumer Direct of America, Inc. Paragon Financial has agreed to pay Consumer Direct of America, Inc. approximately $21,000 in costs that were incurred by Consumer Direct of America, Inc. as a result of the unsuccessful merger transaction.

Paul Danner, Interim Chief Executive Officer of Paragon said that while it was disappointing that their plan to acquire Shearson did not materialize the way they had originally envisioned, he announced that they  "re-engaged" their previous investment banking relationship with Crusader Securities and "are hopeful that a modest capital infusion sufficient for us to pursue our business strategy is imminent." Danner also noted, "We continue to be optimistic about the Company's acquisition and organic growth plans, and are looking forward to pursuing a series of opportunities."

Dominion Homes Inc. and Wells Fargo Home Mortgage Inc. have finalized their mortgage-banking joint venture.

The new business, dubbed Centennial Home Mortgage LLC, will originate and fund mortgages for potential Dominion customers in the homebuilder's markets in Ohio, Kentucky and Indiana, as well as the general public.

The business will take over the mortgage-origination services, including qualifying borrowers and processing applications, previously handled by Dominion's mortgage-brokerage arm, Dominion Homes Financial Services Ltd.