BB&T has signed an agreement to acquire National Penn Bancshares in a cash and stock transaction worth about $1.8bn.

The transaction would consist of 70% BB&T shares and 30% in cash, with National Penn shareholders having the option to secure 0.3206 of a BB&T share or $13 in cash for each National Penn share.

Following the acquisition, National Penn president and CEO Scott Fainor will be appointed as the group executive and will be tasked with managing multiple community banking regions.

Further, BB&T has unveiled plans to set up a fourth community banking region for eastern Pennsylvania, based in Allentown, and will appoint National Penn chief banking officer David Kennedy as the president of the region.

BB&T intends to incur pre-tax merger and integration costs of about $100m, and expects cost savings of nearly $65m per year.

The transaction, subject to approval from regulators and National Penn shareholders, is scheduled to close in mid-2016.

BB&T chairman and CEO Kelly King said: "The acquisition of National Penn provides a tremendous opportunity to strengthen our franchise in Pennsylvania and continue building the scale necessary to operate efficiently and with high quality service.

"As the fourth largest bank in the state, we will have a significant presence in these markets. BB&T will have the breadth of market coverage combined with excellent client service levels that will allow us to grow our client base."