Banks are spending billions to keep up with the break-neck speed in technology and upgrade older, legacy systems. But firms without billions of dollars to pour into that effort are forced to get creative.
One option is teaming up. BB&T and SunTrust announced they were taking that route on Thursday, in part to stay competitive in today's digital landscape. The two plan to merge in a $66 billion deal to make them the sixth biggest U.S. bank based on customer assets.
The combined bank will be in a better position to invest in cyber defense, compete on mobile and automate existing systems, the companies said. SunTrust and BB&T told investors on a call Thursday that they factored in an additional $100 million on technology.
BB&T and SunTrust need to be competitive, but not on the same scale as Citi or JP Morgan, says Stephen Scouten
Changing customer demands set the stage for the "tremendous increase in the need for technological investment," according to BB&T's CEO.
"Our clients now demand what I call real-time satisfaction — they want what they want, when they want it," BB&T CEO Kelly King told CNBC's "Squawk on the Street" Thursday. "We are all facing an increasing set of complex economic realities where we have to invest more and more in technology."