424B3 1 nt10016461x4_424b3.htm 424B3

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Filed pursuant to Rule 424(b)(3)
Registration Statement No. 333-250131



To the Stockholders of First Citizens BancShares, Inc. and CIT Group Inc.
MERGER PROPOSED—YOUR VOTE IS VERY IMPORTANT
On behalf of the boards of directors of First Citizens BancShares, Inc. (“First Citizens”) and CIT Group Inc. (“CIT”), we are pleased to enclose the accompanying joint proxy statement/prospectus relating to the proposed merger of equals between First Citizens and CIT. We are requesting that you take certain actions as a holder of Class A common stock, par value $1.00 per share, of First Citizens (the “First Citizens Class A common stock”), a holder of Class B common stock, par value $1.00 per share, of First Citizens (the “First Citizens Class B common stock,” and together with the First Citizens Class A common stock, the “First Citizens common stock”) or as a holder of common stock, par value $0.01 per share, of CIT (the “CIT common stock”).
The boards of directors of First Citizens and CIT have each unanimously approved an agreement to merge our two companies. On October 15, 2020, First Citizens, First-Citizens Bank & Trust Company, a North Carolina chartered commercial bank and a direct, wholly-owned subsidiary of First Citizens (“First Citizens Bank”), FC Merger Subsidiary IX, Inc., a direct, wholly-owned subsidiary of First Citizens Bank (“Merger Sub”), and CIT entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”) that provides for the combination of First Citizens and CIT, with First Citizens as the surviving parent entity (which we refer to as the “combined company” or “First Citizens”, as the case may be). Under the merger agreement, (i) Merger Sub will merge with and into CIT (which we refer to as the “first step merger”), with CIT surviving the first step merger and becoming a wholly-owned subsidiary of First Citizens Bank (we refer to CIT, in such capacity, as the “interim surviving entity”) and (ii) as soon as reasonably practicable following the first step merger, and as part of a single integrated transaction, the interim surviving entity will merge with and into First Citizens Bank, with First Citizens Bank surviving (which we refer to as the “second step merger”). Immediately following the completion of the second step merger, the separate corporate existence of the interim surviving entity will cease and First Citizens Bank will continue as the surviving corporation of the second step merger. Immediately following the second step merger, CIT Bank, N.A., a wholly-owned subsidiary of CIT (“CIT Bank”), will merge with and into First Citizens Bank, with First Citizens Bank continuing as the surviving bank (which we refer to as the “bank merger” and, together with the first step merger and the second step merger, the “mergers”).
The proposed mergers will provide a strong foundation for the combined company to better serve clients and communities and is expected to establish one of the top twenty largest banks in the United States based on assets (excluding foreign-owned banks). The combined company, as reported at September 30, 2020, would have had approximately $109.4 billion in assets and $87.1 billion in deposits. We believe that the combined company will benefit from greater scale, which in turn will drive growth, improve profitability and enhance stockholder value.
In the first step merger, holders of CIT common stock will receive 0.06200 shares (the “exchange ratio” and such shares, the “merger consideration”) of First Citizens Class A common stock for each share of CIT common stock they own. Holders of First Citizens common stock will continue to own their existing shares of First Citizens common stock. Based on the closing price of First Citizens Class A common stock on Nasdaq Global Select Market (“Nasdaq”) on October 15, 2020, the last trading day before public announcement of the mergers, the exchange ratio represented approximately $21.91 in value for each share of CIT common stock. Based on the closing price of First Citizens Class A common stock on Nasdaq on December 18, 2020, the last practicable trading day before the date of this accompanying joint proxy statement/prospectus, of $585.26, the exchange ratio represented approximately $36.29 in value for each share of CIT common stock. The value of the First Citizens Class A common stock at the time of completion of the first step merger could be greater than, less than or the same as the value of First Citizens Class A common stock on the date of the accompanying joint proxy statement/prospectus. We urge you to obtain current market quotations of First Citizens Class A common stock (trading symbol “FCNCA”) and CIT common stock (trading symbol “CIT”). First Citizens Class B common stock trades on the over-the-counter market and is quoted on the OTC Bulletin Board under the symbol “FCNCB”.
In addition, each share of fixed-to-floating rate non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of CIT (the “CIT series A preferred stock”) and 5.625% non-cumulative perpetual preferred stock, Series B, par value $0.01 per share, of CIT (the “CIT series B preferred stock” and, together with the CIT series A preferred stock, the “CIT preferred stock”) issued and outstanding immediately prior to the effective time of the first step merger will be converted into the right to receive one (1) share of a newly created series of preferred stock, Series B, of First Citizens (the “First Citizens series B preferred stock”) and one (1) share of a newly created series of preferred stock, Series C, of First Citizens (the “First Citizens series C preferred stock” and, together with the First Citizens series B preferred stock, the “new First Citizens preferred stock”), respectively, having such rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, that are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, of the CIT series A preferred stock and the CIT series B preferred stock, respectively (taking into account (i) that CIT will not survive the consummation of the mergers, and (ii) any adjustment to the existing right of optional redemption associated with each series of CIT preferred stock by First Citizens that is reasonably necessary to obtain Tier 1 Capital treatment from the Board of Governors of the Federal Reserve System for such preferred stock). The CIT series B preferred stock are currently listed on the New York Stock Exchange under the symbol “CITPRB”. The shares of newly created First Citizens series C preferred stock are expected to be listed on Nasdaq upon completion of the mergers.
We expect the first step merger and the second step merger will together qualify as a reorganization for federal income tax purposes. Accordingly, holders of CIT common stock or CIT preferred stock generally will not recognize any gain or loss for federal income tax purposes on the exchange of shares of CIT common stock or CIT preferred stock, as applicable, for First Citizens Class A common stock or the applicable series of new First Citizens preferred stock, as applicable, in the first step merger, except with respect to any cash received by holders of CIT common stock instead of fractional shares of First Citizens Class A common stock.
Based on the current number of shares of CIT common stock outstanding and reserved for issuance, First Citizens expects to issue approximately 6.2 million shares of First Citizens Class A common stock to holders of CIT common stock in the aggregate in the first step merger. Following the completion of the mergers, we estimate that current holders of CIT common stock will own approximately 39% of the combined company and current holders of First Citizens common stock will own approximately 61% of the common stock of the combined company.

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First Citizens and CIT will each hold a special meeting of our respective stockholders in connection with the mergers. At our respective special meetings, in addition to other business, First Citizens will ask holders of its common stock to approve the issuance of First Citizens Class A common stock to holders of CIT common stock pursuant to the merger agreement and CIT will ask holders of its common stock to adopt the merger agreement. Information about these meetings and the mergers are contained in the accompanying joint proxy statement/prospectus. In particular, see “Risk Factors” beginning on page 43 for a discussion of the risks you should consider in evaluating the proposed mergers and how the proposed mergers may affect you. You can also obtain information about First Citizens and CIT from documents that have been filed with the Securities and Exchange Commission that are incorporated into this joint proxy statement/prospectus by reference. We urge you to read this joint proxy statement/prospectus carefully and in its entirety.
Holders of CIT preferred stock are not entitled to, and are not requested to, vote at the CIT special meeting. Holders of First Citizens series A preferred stock are not entitled to, and are not requested to, vote at the First Citizens special meeting.
The special meeting of holders of CIT common stock will be held virtually on February 9, 2021 at the following website: www.virtualshareholdermeeting.com/CIT2021SM, at 10:00 a.m. local time. The special meeting of holders of First Citizens common stock will be held virtually on February 9, 2021 at the following website: www.virtualshareholdermeeting.com/FIZN2021, at 10:00 a.m. local time.
Each of our boards of directors unanimously recommends that holders of common stock vote “FOR” each of the proposals to be considered at the respective meetings. We strongly support this combination of our companies and join our boards in their recommendations.
On behalf of the First Citizens and CIT boards of directors, thank you for your prompt attention to this important matter.
Sincerely,


Frank B. Holding, Jr.
Ellen R. Alemany
Chairman and Chief Executive Officer
Chairwoman and Chief Executive Officer
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in connection with the mergers or determined if this document is accurate or complete. Any representation to the contrary is a criminal offense.
The securities to be issued in the first step merger are not savings or deposit accounts or other obligations of any bank or non-bank subsidiary of either First Citizens or CIT, and they are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.
The accompanying joint proxy statement/prospectus is dated December 23, 2020, and is first being mailed to holders of First Citizens common stock and holders of CIT common stock on or about December 30, 2020.

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ADDITIONAL INFORMATION
The accompanying joint proxy statement/prospectus incorporates important business and financial information about First Citizens and CIT from other documents that are not included in or delivered with this joint proxy statement/prospectus. This information is available to you without charge upon your written or oral request. You can obtain the documents incorporated by reference in this document through the Securities and Exchange Commission website at http://www.sec.gov or by requesting them in writing or by telephone at the appropriate address below:
if you are a First Citizens stockholder:
First Citizens BancShares, Inc.
4300 Six Forks Road
Raleigh, North Carolina 27609
Attn: Bridget L. Welborn
(919) 716-8941
if you are a CIT stockholder:
CIT Group Inc.
One CIT Drive
Livingston, New Jersey 07039
Attn: James R. Hubbard
(866) 542-4847
You will not be charged for any of these documents that you request. To obtain timely delivery of these documents, you must request them no later than five (5) business days before the date of the applicable special meeting. This means that holders of First Citizens common stock requesting documents must do so by February 2, 2021, in order to receive them before the First Citizens special meeting, and holders of CIT common stock requesting documents must do so by February 2, 2021, in order to receive them before the CIT special meeting.
No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this joint proxy statement/prospectus. This joint proxy statement/prospectus is dated December 23, 2020, and you should assume that the information in this document is accurate only as of such date. You should assume that the information incorporated by reference into this document is accurate as of the date of such incorporated document. Neither the mailing of this joint proxy statement/prospectus to holders of First Citizens common stock or holders of CIT common stock, nor the issuance by First Citizens of shares of First Citizens Class A common stock or new First Citizens preferred stock pursuant to the merger agreement will create any implication to the contrary.
This joint proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Except where the context otherwise indicates, information contained in, or incorporated by reference into, this document regarding CIT has been provided by CIT and information contained in, or incorporated by reference into, this document regarding First Citizens has been provided by First Citizens.
See the section entitled “Where You Can Find More Information” beginning on page 183 of the accompanying joint proxy statement/prospectus for further information.

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FIRST CITIZENS BANCSHARES, INC.
4300 Six Forks Road
Raleigh, North Carolina 27609
(919) 716-7000
NOTICE OF VIRTUAL SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 9, 2021
To the Stockholders of First Citizens BancShares, Inc.:
On October 15, 2020, First Citizens BancShares, Inc., a Delaware corporation (“First Citizens”), First-Citizens Bank & Trust Company, a North Carolina chartered commercial bank and direct, wholly-owned subsidiary of First Citizens (“First Citizens Bank”), FC Merger Subsidiary IX, Inc., a direct, wholly-owned subsidiary of First Citizens Bank (“Merger Sub”), and CIT Group Inc., a Delaware corporation (“CIT”) entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”), a copy of which is attached as Annex A to the accompanying joint proxy statement/prospectus.
NOTICE IS HEREBY GIVEN that a Special Meeting of holders of First Citizens common stock (the “First Citizens special meeting”) will be held virtually on February 9, 2021 at 10:00 a.m., local time. In light of the on-going developments related to the COVID-19 pandemic and to protect the health of First Citizens’ stockholders and the community, the First Citizens special meeting will be held in a virtual-only format conducted via live audio webcast. You will be able to attend the special meeting by visiting www.virtualshareholdermeeting.com/FIZN2021 and inserting the control number included in your proxy card. You will be able to vote your shares electronically over the Internet and submit questions online during the meeting by logging in to the website listed above and using the control number. We are pleased to notify you of and invite you to the First Citizens special meeting.
At the First Citizens special meeting you will be asked to vote on the following matters:
Proposal to approve the issuance of First Citizens Class A common stock to holders of CIT common stock pursuant to the merger agreement (the “First Citizens stock issuance proposal”).
Proposal to adjourn the First Citizens special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes to approve the First Citizens stock issuance proposal or to ensure that any supplement or amendment to the accompanying joint proxy statement/prospectus is timely provided to holders of First Citizens common stock (the “First Citizens adjournment proposal”).
The board of directors of First Citizens has fixed the close of business on December 30, 2020, as the record date for the First Citizens special meeting. Only holders of record of First Citizens common stock as of the close of business on the record date for the First Citizens special meeting are entitled to notice of the First Citizens special meeting or any adjournment or postponement thereof. Holders of the 5.375% non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of First Citizens are not entitled to, and are not requested to, vote at the First Citizens special meeting.
To participate, vote or ask questions at the First Citizens special meeting, stockholders will need to enter the control number found on the proxy card to log in to www.virtualshareholdermeeting.com/FIZN2021. A list of stockholders eligible to vote will be available for review on the virtual meeting website during the pendency of the First Citizens special meeting, as well as available for inspection and review by stockholders at our office located at 4300 Six Forks Road, Raleigh, North Carolina 27609 from January 29, 2021 to the date of the First Citizens special meeting. In consideration of current public health practices, please wear a face mask and practice social distancing measures at the First Citizens office.

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Technical assistance will be available for stockholders who experience an issue accessing the meeting. Contact information for technical support will appear on the virtual meeting website prior to the start of the meeting.
First Citizens has determined that holders of First Citizens common stock are not entitled to dissenters’ rights with respect to the proposed merger under Section 262 of the Delaware General Corporation Law.
The First Citizens board of directors unanimously recommends that holders of First Citizens common stock vote “FOR” the First Citizens stock issuance proposal and “FOR” the First Citizens adjournment proposal.
Your vote is important. We cannot complete the transactions contemplated by the merger agreement unless holders of First Citizens common stock approve the First Citizens stock issuance proposal. The affirmative vote of the holders of at least a majority of the votes cast at the First Citizens special meeting is required to approve the First Citizens stock issuance proposal.
Each copy of the joint proxy statement/prospectus mailed to holders of First Citizens common stock is accompanied by a form of proxy card with instructions for voting.
Whether or not you plan to attend the First Citizens special meeting, we urge you to please promptly complete, sign, date and return the accompanying proxy card in the enclosed postage-paid envelope or authorize the individuals named on the accompanying proxy card to vote your shares by calling the toll-free telephone number or by using the Internet as described in the instructions included with the accompanying proxy card. If your shares are held in the name of a bank, broker, or other nominee, please follow the instructions on the voting instruction card furnished by such bank, broker or other nominee.
 
By Order of the Board of Directors
 

 
Frank B. Holding, Jr.
Chairman and Chief Executive Officer
First Citizens BancShares, Inc.
Raleigh, North Carolina
December 23, 2020

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CIT Group Inc.
11 West 42nd Street
New York, New York 10036
(212) 461-5200
NOTICE OF VIRTUAL SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 9, 2021
To the Stockholders of CIT Group Inc.:
On October 15, 2020, CIT Group Inc., a Delaware corporation (“CIT”), First Citizens BancShares, Inc., a Delaware corporation (“First Citizens”), First-Citizens Bank & Trust Company, a North Carolina chartered commercial bank and direct, wholly-owned subsidiary of First Citizens (“First Citizens Bank”) and FC Merger Subsidiary IX, Inc., a direct, wholly-owned subsidiary of First Citizens Bank entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”), a copy of which is attached as Annex A to the accompanying joint proxy statement/prospectus.
NOTICE IS HEREBY GIVEN that a special meeting of holders of CIT common stock (the “CIT special meeting”) will be held virtually on February 9, 2021 at 10:00 a.m., local time, at the following website: www.virtualshareholdermeeting.com/CIT2021SM. The CIT special meeting will be held in a virtual-only format due to the public health concerns and current official guidance related to the COVID-19 pandemic. We are pleased to notify you of and invite you to the CIT special meeting.
At the CIT special meeting you will be asked to vote on the following matters:
Proposal to adopt the merger agreement (the “CIT merger proposal”).
Proposal to approve, on an advisory (non-binding) basis, the executive officer compensation that will or may be paid to CIT’s named executive officers in connection with the transactions contemplated by the merger agreement (the “CIT compensation proposal”).
Proposal to adjourn the CIT special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes to approve the CIT merger proposal or to ensure that any supplement or amendment to the accompanying joint proxy statement/prospectus is timely provided to holders of CIT common stock (the “CIT adjournment proposal”).
The board of directors of CIT has fixed the close of business on December 30, 2020, as the record date for the CIT special meeting. Only holders of record of CIT common stock as of the close of business on the record date for the CIT special meeting are entitled to receive notice of and to vote at the CIT special meeting or any adjournment or postponement thereof. Holders of CIT preferred stock are not entitled to, and are not requested to, vote at the CIT special meeting.
To participate, vote or ask questions at the CIT special meeting, stockholders will need to enter the control number found on the proxy card to log in to www.virtualshareholdermeeting.com/CIT2021SM. A list of stockholders eligible to vote will be available for review on the virtual meeting website during the pendency of the CIT special meeting, as well as available for inspection and review by stockholders at our office located at One CIT Drive, Livingston, New Jersey 07039 from January 29, 2021 to the date of the CIT special meeting. In consideration of current public health practices, please wear a face mask and practice social distancing measures at the CIT office.
Technical assistance will be available for stockholders who experience an issue accessing the meeting. Contact information for technical support will appear on the virtual meeting website prior to the start of the meeting.
CIT has determined that holders of CIT common stock and CIT preferred stock are not entitled to appraisal rights with respect to the proposed merger under Section 262 of the Delaware General Corporation Law.

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The CIT board of directors unanimously recommends that holders of CIT common stock vote “FOR” the CIT merger proposal, “FOR” the CIT compensation proposal and “FOR” the CIT adjournment proposal.
Your vote is important. We cannot complete the transactions contemplated by the merger agreement unless holders of CIT common stock approve the CIT merger proposal. The affirmative vote of the holders of at least a majority of the outstanding shares of CIT common stock entitled to vote on the merger agreement is required to approve the CIT merger proposal.
Each copy of the joint proxy statement/prospectus mailed to holders of CIT common stock is accompanied by a form of proxy card with instructions for voting.
Whether or not you plan to attend the CIT special meeting, we urge you to please promptly complete, sign, date and return the accompanying proxy card in the enclosed postage-paid envelope or authorize the individuals named on the accompanying proxy card to vote your shares by calling the toll-free telephone number or by using the Internet as described in the instructions included with the accompanying proxy card. If your shares are held in the name of a bank, broker, or other nominee, please follow the instructions on the voting instruction card furnished by such bank, broker or other nominee.
 
By Order of the Board of Directors
 

 
Ellen R. Alemany
Chairwoman and Chief Executive Officer
CIT Group Inc.
December 23, 2020

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QUESTIONS AND ANSWERS
The following are some questions that you may have about the mergers, the First Citizens special meeting or the CIT special meeting, and brief answers to those questions. First Citizens and CIT urge you to read carefully the remainder of this joint proxy statement/prospectus because the information in this section does not provide all of the information that might be important to you with respect to the mergers, the First Citizens special meeting or the CIT special meeting. Additional important information is also contained in the documents incorporated by reference into this joint proxy statement/prospectus. See the section entitled “Where You Can Find More Information” beginning on page 183.
In this joint proxy statement/prospectus, unless the context otherwise requires:
“CIT” refers to CIT Group Inc.;
“CIT Bank” refers to CIT Bank, N.A., a national banking association and wholly-owned subsidiary of CIT;
“CIT common stock” refers to the common stock, par value $0.01 per share, of CIT;
“CIT preferred stock” refers, collectively, to the CIT series A preferred stock and the CIT series B preferred stock;
“CIT series A preferred stock” refers to the fixed-to-floating rate non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of CIT;
“CIT series B preferred stock” refers to the 5.625% non-cumulative perpetual preferred stock, Series B, par value $0.01 per share, of CIT;
“First Citizens” refers to First Citizens BancShares, Inc.;
“First Citizens Bank” refers to First-Citizens Bank & Trust Company, a North Carolina chartered commercial bank and a direct, wholly-owned subsidiary of First Citizens;
“First Citizens Class A common stock” refers to the Class A common stock, par value $1.00 per share, of First Citizens;
“First Citizens Class B common stock” refers to the Class B common stock, par value $1.00 per share, of First Citizens;
“First Citizens common stock” refers, collectively, to the First Citizens Class A common stock and the First Citizens Class B common stock;
“First Citizens series A preferred stock” refers to the 5.375% non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of First Citizens;
“First Citizens series B preferred stock” refers to the fixed-to-floating rate non-cumulative perpetual preferred stock, Series B, par value $0.01, of First Citizens;
“First Citizens series C preferred stock” refers to the 5.625% non-cumulative perpetual preferred stock, Series C, par value $0.01, of First Citizens;
“New First Citizens preferred stock” refers, collectively, to the First Citizens series B preferred stock and the First Citizens series C preferred stock that will be issued to holders of CIT series A preferred stock and CIT series B preferred stock, respectively, pursuant to the merger agreement; and
“Merger Sub” refers to FC Merger Subsidiary IX, Inc., a direct, wholly-owned subsidiary of First Citizens Bank.
Q:
Why am I receiving this joint proxy statement/prospectus?
A:
You are receiving this joint proxy statement/prospectus because First Citizens, First Citizens Bank, Merger Sub, and CIT have entered into an Agreement and Plan of Merger, dated October 15, 2020 (as amended from time to time, the “merger agreement”) pursuant to which First Citizens and CIT will combine their companies in a merger of equals. Pursuant to the merger agreement, (i) Merger Sub will merge with and into CIT (which we refer to as the “first step merger”), with CIT surviving the first step merger and
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becoming a wholly-owned subsidiary of First Citizens Bank (we refer to CIT, in such capacity, as the “interim surviving entity”) and (ii) as soon as reasonably practicable following the first step merger, and as part of a single integrated transaction, the interim surviving entity will merge with and into First Citizens Bank, with First Citizens Bank surviving (which we refer to as the “second step merger”). Immediately following the second step merger, First Citizens Bank and CIT Bank will merge and First Citizens Bank will continue as the surviving bank (which we refer to as the “bank merger” and, together with the first step merger and the second step merger, the “mergers”). A copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus and is incorporated by reference herein. In this joint proxy statement/prospectus, we refer to the closing of the transactions contemplated by the merger agreement as the “closing” and the date on which the closing occurs as the “closing date”.
In order to complete the mergers, among other things:
holders of First Citizens common stock must approve the issuance of First Citizens Class A common stock to holders of CIT common stock pursuant to the merger agreement in order to comply with applicable Nasdaq Global Select Market (“Nasdaq”) listing rules (the “First Citizens stock issuance proposal”); and
holders of CIT common stock must adopt the merger agreement (the “CIT merger proposal”).
First Citizens is holding a virtual special meeting of holders of First Citizens common stock (the “First Citizens special meeting”) to obtain approval of the First Citizens stock issuance proposal.
Holders of First Citizens common stock will also be asked to approve the proposal to adjourn the First Citizens special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes at the time of the First Citizens special meeting to approve the First Citizens stock issuance proposal or to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to holders of First Citizens common stock (the “First Citizens adjournment proposal”).
Holders of First Citizens series A preferred stock are not entitled to, and are not requested to, vote at the First Citizens special meeting. Holders of First Citizens common stock and First Citizens series A preferred stock are not entitled to appraisal or dissenters’ rights.
CIT is holding a special meeting of holders of CIT common stock (the “CIT special meeting”) to obtain approval of the CIT merger proposal. Holders of CIT common stock will also be asked (1) to approve, on an advisory (non-binding) basis, the executive officer compensation that will or may be paid to CIT’s named executive officers in connection with the transactions contemplated by the merger agreement (the “CIT compensation proposal”) and (2) to approve the proposal to adjourn the CIT special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes to approve the CIT merger proposal or to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to holders of CIT common stock (the “CIT adjournment proposal”).
Holders of CIT preferred stock are not entitled to, and are not requested to, vote at the CIT special meeting. Holders of CIT common stock and CIT preferred stock are not entitled to appraisal or dissenters’ rights.
This document is also a prospectus that is being delivered to holders of CIT common stock because, pursuant to the merger agreement, First Citizens is offering shares of First Citizens Class A common stock to holders of CIT common stock. First Citizens is also issuing shares of First Citizens series B preferred stock and First Citizens series C preferred stock to holders of CIT series A preferred stock and CIT series B preferred stock, respectively. Each share of CIT series A preferred stock and CIT series B preferred stock issued and outstanding immediately prior to the effective time of the first step merger (the “effective time”) will be automatically converted into the right to receive one (1) share of First Citizens series B preferred stock and First Citizens series C preferred stock, respectively, at the effective time.
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This joint proxy statement/prospectus contains important information about the mergers and the other proposals being voted on at the First Citizens and CIT special meetings. You should read it carefully and in its entirety. The enclosed materials allow you to have your shares of common stock voted by proxy without attending your meeting. Your vote is important and we encourage you to submit your proxy as soon as possible.
Q:
What will happen in the mergers?
A:
During the first step merger, Merger Sub will merge with and into CIT, with CIT surviving. In the second step merger, CIT, as the surviving entity of the first step merger, will merge with and into First Citizens Bank, with First Citizens Bank surviving. Immediately following the second step merger, First Citizens Bank and CIT Bank will merge and First Citizens Bank will continue as the surviving bank.
Each share of CIT common stock issued and outstanding immediately prior to the effective time (other than certain shares held by First Citizens or CIT) will be converted into the right to receive 0.06200 shares (the “exchange ratio” and such shares, the “merger consideration”) of First Citizens Class A common stock. After completion of the mergers, (1) CIT will cease to exist and will no longer be a public company, (2) CIT common stock and CIT series B preferred stock will be delisted from the New York Stock Exchange (the “NYSE”) and will cease to be publicly traded, and (3) the CIT common stock, CIT series A preferred stock and CIT series B preferred stock will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Holders of First Citizens common stock and First Citizens series A preferred stock will continue to own their existing shares of First Citizens common stock and First Citizens series A preferred stock, respectively. See the information provided in the section entitled “The Merger Agreement—Structure of the Mergers” beginning on page 131 and the merger agreement for more information about the mergers.
Q:
When and where will each of the special meetings take place?
A:
The First Citizens special meeting will be held virtually at the following website: www.virtualshareholdermeeting.com/FIZN2021, on February 9, 2021 at 10:00 a.m. local time.
The CIT special meeting will be held virtually at the following website: www.virtualshareholdermeeting.com/CIT2021SM, on February 9, 2021 at 10:00 a.m. local time.
Even if you plan to attend your respective company’s special meeting, First Citizens and CIT recommend that you vote your shares in advance as described below so that your vote will be counted if you later decide not to or become unable to attend the applicable special meeting. Shares held in “street name” may be voted at the CIT special meeting or the First Citizens special meeting, as applicable, by you only if you obtain a signed legal proxy from your bank, broker or other nominee giving you the right to vote the shares.
Q:
What matters will be considered at each of the special meetings?
A:
At the First Citizens special meeting, holders of First Citizens common stock will be asked to consider and vote on the following proposals:
First Citizens Proposal 1: The First Citizens stock issuance proposal. Approval of the issuance of First Citizens common stock to holders of CIT common stock pursuant to the merger agreement; and
First Citizens Proposal 2: The First Citizens adjournment proposal. Approval of the adjournment of the First Citizens special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes at the time of the First Citizens special meeting to approve the First Citizens stock issuance proposal or to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to holders of First Citizens common stock.
At the CIT special meeting, holders of CIT common stock will be asked to consider and vote on the following proposals:
CIT Proposal 1: The CIT merger proposal. Adoption of the merger agreement;
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CIT Proposal 2: The CIT compensation proposal. Approval of, on an advisory (non-binding) basis, the executive officer compensation that will or may be paid to CIT’s named executive officers in connection with the transactions contemplated by the merger agreement; and
CIT Proposal 3: The CIT adjournment proposal. Approval of the adjournment of the CIT special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes to approve the CIT merger proposal or to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to holders of CIT common stock.
In order to complete the mergers, among other things, holders of First Citizens common stock must approve the First Citizens stock issuance proposal and holders of CIT common stock must approve the CIT merger proposal. None of the approvals of the First Citizens adjournment proposal, the CIT compensation proposal or the CIT adjournment proposal are conditions to the obligations of First Citizens or CIT to complete the mergers.
Q:
What will holders of CIT common stock receive in the first step merger?
A:
At the effective time, each share of CIT common stock issued and outstanding immediately prior to the effective time (other than certain shares held by First Citizens or CIT) will be automatically converted into the right to receive 0.06200 shares of First Citizens Class A common stock. First Citizens will not issue any fractional shares of First Citizens common stock in the first step merger. Holders of CIT common stock who would otherwise be entitled to a fractional share of First Citizens Class A common stock in the first step merger will instead receive an amount in cash (rounded to the nearest cent) determined by multiplying (i) the average of the closing-sale prices per share of First Citizens Class A common stock on Nasdaq as reported by The Wall Street Journal for the consecutive period of twenty (20) full trading days ending on and including the business day that is two (2) business days immediately prior to the closing date by (ii) the fraction of a share (after taking into account all shares of CIT common stock held by such holder immediately prior to the effective time and rounded to the nearest one-thousandth when expressed in decimal form) of First Citizens Class A common stock that such stockholder would otherwise be entitled to receive.
Q:
What will holders of CIT preferred stock receive in the first step merger?
A:
At the effective time, each share of CIT series A preferred stock and CIT series B preferred stock issued and outstanding immediately prior to the effective time will be automatically converted into the right to receive one (1) share of First Citizens series B preferred stock and one (1) share of First Citizens series C preferred stock, respectively. The CIT series B preferred stock is currently listed on the NYSE under the symbol “CITPRB”. The shares of First Citizens series C preferred stock are expected to be listed on Nasdaq upon completion of the mergers.
Q:
What will holders of First Citizens common stock receive in the first step merger?
A:
In the first step merger, holders of First Citizens common stock will not receive any consideration, and their shares of First Citizens common stock will remain outstanding and will constitute shares of the combined company. Following the mergers, shares of First Citizens Class A common stock will continue to be listed on Nasdaq.
Q:
Will the value of the merger consideration change between the date of this joint proxy statement/prospectus and the time the mergers are completed?
A:
Yes. Although the number of shares of First Citizens Class A common stock that holders of CIT common stock will receive is fixed, the value of the merger consideration will fluctuate between the date of this joint proxy statement/prospectus and the completion of the mergers based upon the market value for First Citizens Class A common stock. Any fluctuation in the market price of First Citizens Class A common stock after the date of this joint proxy statement/prospectus will change the value of the shares of First Citizens Class A common stock that holders of CIT common stock will receive. Neither First Citizens nor CIT is permitted to terminate the merger agreement as a result, in and of itself, of any increase or decrease in the market price of First Citizens Class A common stock or CIT common stock.
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Q:
How will the mergers affect CIT equity awards?
A:
At the effective time:
except as otherwise agreed by First Citizens and CIT, each outstanding restricted stock unit award in respect of shares of CIT common stock, including any deferred restricted stock unit award (each, a “CIT RSU Award”), other than a CIT Director RSU (as defined below), will, at the effective time, automatically and without any required action on the part of the holder thereof, be converted into a number of restricted stock units in respect of shares of First Citizens Class A common stock equal to the product (with the result rounded up to the nearest whole share) of (i) the number of shares of CIT common stock subject to each such CIT RSU Award as of immediately prior to the effective time determined based on target level performance (to the extent applicable) multiplied by (ii) the exchange ratio. Each converted award will in all other respects be subject to the same terms and conditions (including vesting terms, payment timing and rights to receive dividend equivalents) applicable to the existing CIT RSU Award under the applicable equity plan and award agreement as in effect immediately prior to the effective time;
except as otherwise agreed by First Citizens and CIT, each outstanding restricted stock unit award in respect of shares of CIT common stock that (i) is outstanding and unvested as of immediately prior to the effective time, (ii) is held by a member of the CIT board of directors, (iii) will automatically vest upon the effective time in accordance with its terms and (iv) is not subject to a deferral election (each, a “CIT Director RSU”), will, at the effective time, automatically and without any required action on the part of the holder thereof, be converted into the right to receive the merger consideration in respect of the number of shares of CIT common stock subject to such CIT Director RSU, less applicable tax withholding (if any), which will be delivered as soon as reasonably practicable following the closing date and in no event later than five (5) days following the closing date; and
except as otherwise agreed by First Citizens and CIT, each outstanding performance unit award in respect of shares of CIT common stock (each, a “CIT PSU”) that is outstanding immediately prior to the effective time will, automatically and without any required action on the part of the holder thereof, be converted into a number of restricted stock units in respect of shares of First Citizens Class A common stock equal to the product (with the result rounded up to the nearest whole share) of (i) the number of shares of CIT common stock subject to each such CIT PSU as of immediately prior to the effective time determined based on target level performance multiplied by (ii) the exchange ratio. Each converted award will in all other respects be subject to the same terms and conditions (including rights to receive dividend equivalents) applicable to the existing CIT PSU under the applicable equity plan and award agreement as in effect immediately prior to the effective time, provided that vesting will be subject only to continued service of the holder through each applicable final performance date and will not be subject to any performance goals or metrics following the effective time.
Q:
How will the mergers affect CIT’s employee stock purchase plan?
A:
The CIT board of directors (or appropriate committee thereof) will take all necessary actions to ensure that (i) the “offering period” in effect immediately prior to the closing of the mergers (the “final offering”) under the CIT Group Inc. Employee Stock Purchase Plan (the “CIT ESPP”) will end at least five (5) business days prior to the closing date, (ii) each individual participating in the final offering will receive notice of the mergers no later than fifteen days prior to the closing date, (iii) each CIT ESPP participant’s accumulated contributions under the CIT ESPP will be refunded to such participant as soon as practicable following the effective time and will not be used to purchase shares of CIT common stock, and (iv) the CIT ESPP will terminate in its entirety at the effective time and no further rights will be granted or exercised under the CIT ESPP thereafter.
Q:
What if I own CIT preferred stock?
A:
If you are a holder of CIT preferred stock, no action is required of you. You are not entitled to, and are not requested to, vote on the CIT merger proposal, the CIT compensation proposal or the CIT adjournment proposal or to exercise appraisal or dissenters’ rights.
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In the first step merger, each share of CIT preferred stock issued and outstanding immediately prior to the effective time will be converted at the effective time into the right to receive one (1) share of an applicable series of new First Citizens preferred stock having such rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, that are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, of the applicable series of outstanding CIT preferred stock (taking into account (i) that CIT will not be the surviving entity in the mergers and (ii) any adjustment to the existing right of optional redemption associated with each series of CIT preferred stock by First Citizens that is reasonably necessary to obtain Tier 1 Capital treatment from the Board of Governors of the Federal Reserve for such preferred stock). For more information, see the sections entitled “Treatment of CIT Preferred Stock” and “Description of New First Citizens Preferred Stock” beginning on pages 129 and 152, respectively.
Q:
How does the First Citizens board of directors recommend that I vote at the First Citizens special meeting?
A:
The First Citizens board of directors unanimously recommends that you vote “FOR” the First Citizens stock issuance proposal and “FOR” the First Citizens adjournment proposal.
In considering the recommendations of the First Citizens board of directors, holders of First Citizens common stock should be aware that First Citizens directors and executive officers may have interests in the mergers that are different from, or in addition to, the interests of holders of First Citizens common stock generally. For a more complete description of these interests, see the information provided in the section entitled “The Mergers—Interests of First Citizens’ Directors and Executive Officers in the Mergers” beginning on page 120.
Q:
How does the CIT board of directors recommend that I vote at the CIT special meeting?
A:
The CIT board of directors unanimously recommends that you vote “FOR” the CIT merger proposal, “FOR” the CIT compensation proposal and “FOR” the CIT adjournment proposal.
In considering the recommendations of the CIT board of directors, holders of CIT common stock should be aware that CIT directors and executive officers may have interests in the mergers that are different from, or in addition to, the interests of holders of CIT common stock generally. For a more complete description of these interests, see the information provided in the section entitled “The Mergers—Interests of CIT’s Directors and Executive Officers in the Mergers” beginning on page 121.
Q:
Who is entitled to vote at the First Citizens special meeting?
A:
The record date for the First Citizens special meeting is December 30, 2020. All holders of First Citizens common stock who held shares at the close of business on the record date for the First Citizens special meeting are entitled to receive notice of, and to vote at, the First Citizens special meeting.
Each holder of First Citizens Class A common stock is entitled to cast one (1) vote and each holder of First Citizens Class B common stock is entitled to cast sixteen (16) votes on each matter properly brought before the First Citizens special meeting for each share of First Citizens common stock that such holder owned of record as of the record date. As of December 18, 2020, the last date before the date of this joint proxy statement/prospectus for which it was practicable to obtain this information, there were 8,811,220 outstanding shares of First Citizens Class A common stock and 1,005,185 outstanding shares of First Citizens Class B common stock. Attendance at the special meeting is not required to vote. See below and the section entitled “The First Citizens Special Meeting—Proxies” beginning on page 55 for instructions on how to vote your shares without attending the First Citizens special meeting.
Q:
Who is entitled to vote at the CIT special meeting?
A:
The record date for the CIT special meeting is December 30, 2020. All holders of CIT common stock who held shares at the close of business on the record date for the CIT special meeting are entitled to receive notice of, and to vote at, the CIT special meeting.
Each holder of CIT common stock is entitled to cast one (1) vote on each matter properly brought before the CIT special meeting for each share of CIT common stock that such holder owned of record as of the
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record date. As of December 18, 2020, the last date before the date of this joint proxy statement/prospectus for which it was practicable to obtain this information, there were 98,537,761 outstanding shares of CIT common stock. Attendance at the special meeting is not required to vote. See below and the section entitled “The CIT Special Meeting—Proxies” beginning on page 61 for instructions on how to vote your shares without attending the CIT special meeting.
Q:
What constitutes a quorum for the First Citizens special meeting?
A:
Holders of shares representing a majority of the total votes entitled to be cast by holders of outstanding shares of First Citizens Class A common stock and First Citizens Class B common stock, present or represented by proxy, will be necessary to constitute a quorum for the transaction of business at the First Citizens special meeting. If you fail to submit a proxy or to vote at the First Citizens special meeting, or fail to instruct your bank, broker, trustee or other nominee how to vote, your shares of First Citizens common stock will not be counted towards a quorum. Abstentions are considered present for purposes of establishing a quorum.
Q:
What constitutes a quorum for the CIT special meeting?
A:
Holders of a majority of the voting power of the outstanding shares of CIT common stock entitled to vote at the CIT special meeting, present or represented by proxy, will be necessary to constitute a quorum for the transaction of business at the CIT special meeting. If you fail to submit a proxy or to vote at the CIT special meeting, or fail to instruct your bank, broker, trustee or other nominee how to vote, your shares of CIT common stock will not be counted towards a quorum. Abstentions are considered present for purposes of establishing a quorum.
Q:
If my shares of common stock are held in “street name” by my broker, will my broker vote my shares for me?
A:
If you hold your shares in a stock brokerage account or if your shares are held by a bank, broker or other nominee (that is, in “street name”), please follow the voting instructions provided by your broker, bank, trustee or other nominee. Please note that you may not vote shares held in street name by returning a proxy card directly to First Citizens or CIT or by voting at either special meeting unless you provide a “legal proxy,” which you must obtain from your bank, broker, trustee or other nominee. Further, brokers who hold shares of First Citizens or CIT common stock may not give a proxy to First Citizens or CIT to vote those shares on any of the First Citizens proposals or any of the CIT proposals without specific instructions from their customers.
Q:
What vote is required for the approval of each proposal at the First Citizens special meeting?
A:
First Citizens Proposal 1: First Citizens stock issuance proposal. Under applicable Nasdaq Listing Rules, approval of the First Citizens stock issuance proposal requires the affirmative vote of a majority of the total votes cast by the holders of First Citizens common stock at the First Citizens special meeting or by proxy at the First Citizens special meeting. Accordingly, if you mark “ABSTAIN” on your proxy card, fail to submit a proxy card or vote at the First Citizens special meeting, or fail to instruct your bank or broker how to vote with respect to the First Citizens stock issuance proposal, you will not be deemed to have cast a vote with respect to the proposal and such abstention or broker non-vote or other failure to vote will have no effect on the outcome of the First Citizens stock issuance proposal.
First Citizens Proposal 2: First Citizens adjournment proposal. Approval of the First Citizens adjournment proposal requires the affirmative vote of a majority of the votes cast at the First Citizens special meeting. Accordingly, if you mark “ABSTAIN” on your proxy card, fail to submit a proxy card or vote at the First Citizens special meeting, or fail to instruct your bank or broker how to vote with respect to the First Citizens adjournment proposal, you will not be deemed to have cast a vote with respect to the proposal and such abstention or broker non-vote or other failure to vote will have no effect on the outcome of the First Citizens adjournment proposal.
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Q:
What vote is required for the approval of each proposal at the CIT special meeting?
A:
CIT Proposal 1: CIT merger proposal. Approval of the CIT merger proposal requires the affirmative vote of a majority of the outstanding shares of CIT common stock entitled to vote on the merger agreement. Shares of CIT common stock not present, and shares present and not voted, whether by broker non-vote, abstention or otherwise, will have the same effect as votes cast “AGAINST” the CIT merger proposal.
CIT Proposal 2: CIT compensation proposal. Approval of the CIT compensation proposal requires the affirmative vote of a majority of the shares of CIT common stock entitled to vote who are present or represented by proxy at the CIT special meeting. Accordingly, if you mark “ABSTAIN” on your proxy card, fail to submit a proxy card or vote at the CIT special meeting, or fail to instruct your bank or broker how to vote with respect to the CIT compensation proposal, you will not be deemed to have cast a vote with respect to the proposal and such abstention or broker non-vote or other failure to vote will have no effect on the outcome of the CIT compensation proposal.
CIT Proposal 3: CIT adjournment proposal. Approval of the CIT adjournment proposal requires the affirmative vote of a majority of the shares of CIT common stock entitled to vote who are present or represented by proxy at the CIT special meeting. Accordingly, if you mark “ABSTAIN” on your proxy card, fail to submit a proxy card or vote at the CIT special meeting, or fail to instruct your bank or broker how to vote with respect to the CIT adjournment proposal, you will not be deemed to have cast a vote with respect to the proposal and such abstention or broker non-vote or other failure to vote will have no effect on the outcome of the CIT adjournment proposal.
Q:
Why am I being asked to consider and vote on the CIT compensation proposal?
A:
Under Securities and Exchange Commission (“SEC”) rules, CIT is required to seek a non-binding, advisory vote with respect to the compensation that may be paid or become payable to CIT’s named executive officers that is based on or otherwise relates to the mergers, or “golden parachute” compensation.
Q:
What happens if holders of CIT common stock do not approve, by non-binding, advisory vote, the CIT compensation proposal?
A:
The vote on the proposal to approve the merger-related compensation arrangements for each of CIT’s named executive officers is separate and apart from the votes to approve the other proposals being presented at the CIT special meeting. Because the vote on the proposal to approve the merger-related executive compensation is advisory in nature only, it will not be binding upon CIT, First Citizens, or the combined company in the mergers. Accordingly, the merger-related compensation will be paid to CIT’s named executive officers to the extent payable in accordance with the terms of their compensation agreements and arrangements even if the holders of CIT common stock do not approve the proposal to approve the merger-related executive compensation.
Q:
What if I hold shares in both First Citizens and CIT?
A:
If you hold shares of both First Citizens common stock and CIT common stock, you will receive two (2) separate packages of proxy materials. A vote cast as a holder of First Citizens common stock will not count as a vote cast as a holder of CIT common stock, and a vote cast as a holder of CIT common stock will not count as a vote cast as a holder of First Citizens common stock. Therefore, please submit separate proxies for your shares of First Citizens common stock and your shares of CIT common stock.
Q:
How can I vote my shares at the First Citizens special meeting or the CIT special meeting?
A:
Record Holders. Shares held directly in your name as the holder of record of First Citizens common stock or CIT common stock may be voted at the First Citizens special meeting or the CIT special meeting, as applicable.
Shares in “street name”. Shares held in a brokerage or other account in “street name” may be voted at the First Citizens special meeting or the CIT special meeting, as applicable, by you only if you obtain a signed legal proxy from your bank, broker, trustee or other nominee giving you the right to vote the shares.
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Even if you plan to attend the First Citizens special meeting or the CIT special meeting, as applicable, First Citizens and CIT recommend that you vote your shares in advance as described below so that your vote will be counted if you later decide not to or become unable to attend the respective special meeting.
Additional information on attending the special meetings can be found under the section entitled “The First Citizens Special Meeting” on page 53 and under the section entitled “The CIT Special Meeting” on page 59.
Q:
How can I vote my shares without attending my respective special meeting?
A:
Whether you hold your shares directly as the holder of record of First Citizens common stock or CIT common stock or beneficially in “street name”, you may direct your vote by proxy without attending the First Citizens special meeting or the CIT special meeting, as applicable.
If you are a record holder of First Citizens common stock or CIT common stock, you can vote by proxy over the Internet, by telephone or by mail by following the instructions provided in the enclosed proxy card. Please note that if you hold shares beneficially in “street name”, you should follow the voting instructions provided by your bank, broker, trustee or other nominee.
If you intend to submit your proxy by telephone or via the Internet, you must do so by 11:59 p.m. on the day before your respective company’s special meeting. If you intend to submit your proxy by mail, your completed proxy card must be received prior to your respective company’s special meeting.
Additional information on voting procedures can be found under the section entitled “The First Citizens Special Meeting” on page 53 and under the section entitled “The CIT Special Meeting” on page 59.
Q:
What do I need to do now?
A:
After carefully reading and considering the information contained in this joint proxy statement/prospectus, please vote as soon as possible. If you hold shares of First Citizens common stock or CIT common stock, please respond by completing, signing and dating the accompanying proxy card and returning it in the enclosed postage-paid envelope, or by submitting your proxy by telephone or through the Internet, as soon as possible so that your shares may be represented at your meeting. Please note that if you hold shares beneficially in “street name”, you should follow the voting instructions provided by your bank, broker, trustee or other nominee.
Q:
If my shares are held in “street name” by a broker, bank, trustee or other nominee, will my broker, bank, trustee or other nominee vote my shares for me?
A:
No. Your bank, broker, trustee or other nominee cannot vote your shares on non-routine matters without instructions from you. You should instruct your bank, broker, trustee or other nominee how to vote your shares in accordance with the instructions provided to you, including each company’s respective merger proposals. Please check the voting form used by your bank, broker, trustee or other nominee.
Q:
Why is my vote important?
A:
If you do not vote, it will be more difficult for First Citizens or CIT to obtain the necessary quorum to hold its special meeting. In addition, if you are a holder of CIT common stock and you fail to vote, mark “ABSTAIN” on your proxy, or fail to instruct your bank or broker with respect to the CIT merger proposal, it will have the same effect as a vote “AGAINST” the CIT merger proposal.
In accordance with relevant Nasdaq Listing Rules, the First Citizens stock issuance proposal must be approved by the affirmative vote of a majority of the total votes cast by First Citizens stockholders. If you are a holder of First Citizens common stock, if you mark “ABSTAIN” on your proxy card, fail to submit a proxy card or vote at the First Citizens special meeting, or fail to instruct your bank or broker how to vote with respect to the First Citizens stock issuance proposal, you will not be deemed to have cast a vote with respect to the proposal and it will have no effect on the proposal.
The First Citizens board of directors and the CIT board of directors unanimously recommend that you vote “FOR” the First Citizens stock issuance proposal and “FOR” the CIT merger proposal, respectively, and “FOR” the other proposals to be considered at the First Citizens special meeting and the CIT special meeting, respectively.
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Q:
Can I change my vote after I have delivered my proxy or voting instruction card?
A:
Yes. You can change your vote at any time before your proxy is voted at your meeting. You can do this by:
submitting a written statement that you would like to revoke your proxy to the corporate secretary of First Citizens or CIT, as applicable;
signing and returning a proxy card with a later date;
attending the special meeting and voting at the special meeting; or
voting by telephone or the Internet at a later time.
If your shares are held by a broker, bank, trustee or other nominee, you should contact your broker, bank, trustee or other nominee to change your vote.
Q:
Will First Citizens be required to submit the First Citizens stock issuance proposal to its stockholders even if the First Citizens board of directors has withdrawn, modified or qualified its recommendation?
A:
Yes. Unless the merger agreement is terminated before the First Citizens special meeting, First Citizens is required to submit the First Citizens stock issuance proposal to its stockholders even if the First Citizens board of directors has withdrawn or modified its recommendation.
Q:
Will CIT be required to submit the CIT merger proposal to its stockholders even if the CIT board of directors has withdrawn, modified or qualified its recommendation?
A:
Yes. Unless the merger agreement is terminated before the CIT special meeting, CIT is required to submit the CIT merger proposal to its stockholders even if the CIT board of directors has withdrawn or modified its recommendation.
Q:
Are holders of First Citizens common stock entitled to appraisal or dissenters’ rights?
A:
No. Holders of First Citizens common stock are not entitled to appraisal or dissenters’ rights under the Delaware General Corporation Law (the “DGCL”). For more information, see the section entitled “The Mergers—Appraisal or Dissenters’ Rights in the Mergers” beginning on page 129.
Q:
Are holders of CIT common stock entitled to appraisal or dissenters’ rights?
A:
No. Holders of CIT common stock are not entitled to appraisal or dissenters’ rights under the DGCL. For more information, see the section entitled “The Mergers—Appraisal or Dissenters’ Rights in the Mergersbeginning on page 129.
Q:
Are there any risks that I should consider in deciding whether to vote for the approval of the First Citizens stock issuance proposal or the approval of the CIT merger proposal, or the other proposals to be considered at the First Citizens special meeting and the CIT special meeting, respectively?
A:
Yes. You should read and carefully consider the risk factors set forth in the section entitled “Risk Factorsbeginning on page 43. You also should read and carefully consider the risk factors of First Citizens and CIT contained in the documents that are incorporated by reference into this joint proxy statement/prospectus.
Q:
What are the material U.S. federal income tax consequences of the first step merger and the second step merger to holders of CIT common stock and CIT preferred stock?
A:
The first step merger and the second step merger have been structured to qualify as a reorganization for federal income tax purposes, and it is a condition to our respective obligations to complete the mergers that First Citizens and CIT each receive a legal opinion to the effect that the first step merger and the second step merger will so qualify. Accordingly, holders of CIT common stock and CIT preferred stock generally will not recognize any gain or loss for U.S. federal income tax purposes on the exchange of their CIT common stock for First Citizens Class A common stock and CIT preferred stock for new First Citizens preferred stock, as applicable, in the first step merger, except for any gain or loss that may result from the receipt of cash instead of a fractional share of First Citizens Class A common stock. You should be aware that the tax consequences to you of the mergers may depend upon your own situation. In addition, you may
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be subject to state, local or foreign tax laws that are not discussed in this joint proxy statement/prospectus. You should therefore consult with your own tax advisor for a full understanding of the tax consequences to you of the mergers. For a more complete discussion of the material U.S. federal income tax consequences of the mergers, see the section entitled “Material U.S. Federal Income Tax Consequences of the Mergers” beginning on page 149.
Q:
When are the mergers expected to be completed?
A:
First Citizens and CIT expect the mergers to close in the first half of 2021. However, neither First Citizens nor CIT can predict the actual date on which the mergers will be completed, or if the mergers will be completed at all, because completion is subject to conditions and factors outside the control of both companies. First Citizens and CIT must first obtain the approval of holders of CIT common stock for the CIT merger proposal and obtain the approval of holders of First Citizens common stock for the First Citizens stock issuance proposal, as well as obtain necessary regulatory approvals and satisfy certain other closing conditions.
Q:
What are the conditions to completion of the mergers?
A:
As more fully described in this joint proxy statement/prospectus and in the merger agreement, the obligations of First Citizens and CIT to complete the mergers are subject to the satisfaction or waiver (where legally permissible) of certain closing conditions contained in the merger agreement, including the receipt of required regulatory approvals and the expiration of statutory waiting periods without the imposition of any materially burdensome regulatory condition, the receipt of certain tax opinions, approval by holders of First Citizens common stock of the First Citizens stock issuance proposal and approval by holders of CIT common stock of the CIT merger proposal. For more information, see the section entitled The Merger Agreement—Conditions to Completion of the Mergers” beginning on page 144.
Q:
What happens if the mergers are not completed?
A:
If the mergers are not completed, holders of CIT common stock will not receive any consideration for their shares of CIT common stock in connection with the mergers. Instead, CIT will remain an independent public company, CIT common stock and CIT series B preferred stock will continue to be listed on the NYSE, and First Citizens will not complete the issuance of shares of First Citizens Class A common stock and new First Citizens preferred stock pursuant to the merger agreement. In addition, if the merger agreement is terminated in certain circumstances, a termination fee of $64 million may be payable by either First Citizens or CIT to the other party, as applicable. See the section entitled “The Merger Agreement—Termination Fee” beginning on page 146 for a more detailed discussion of the circumstances under which a termination fee will be required to be paid.
Q:
Should I send in my stock certificates now?
A:
No. Please do not send in your stock certificates with your proxy. After the mergers are completed, Broadridge Corporate Issuer Solutions, Inc. (the “exchange agent”) will send you instructions for exchanging CIT stock certificates for the consideration to be received in the mergers. See the section entitled “The Merger Agreement—Conversion of Shares; Exchange of CIT Stock Certificates” beginning on page 134.
Q:
What should I do if I receive more than one set of voting materials for the same special meeting?
A:
If you hold shares of First Citizens common stock or CIT common stock in “street name” and also directly in your name as a holder of record or otherwise or if you hold shares of First Citizens common stock or CIT common stock in more than one (1) brokerage account, you may receive more than one (1) set of voting materials relating to the same special meeting.
Record Holders. For shares held directly, please complete, sign, date and return each proxy card (or cast your vote by telephone or Internet as provided on each proxy card) or otherwise follow the voting instructions provided in this joint proxy statement/prospectus in order to ensure that all of your shares of First Citizens common stock or CIT common stock are voted.
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Shares in “street name”. For shares held in “street name” through a bank, broker, trustee or other nominee, you should follow the procedures provided by your bank, broker, trustee or other nominee to vote your shares.
Q:
Who can help answer my questions?
A:
First Citizens stockholders: If you have any questions about the mergers or how to submit your proxy or voting instruction card, or if you need additional copies of this document or the enclosed proxy card or voting instruction card, you should contact Investor Relations at 4300 Six Forks Road Raleigh, North Carolina 27609, (919) 716-7000, or First Citizens’ proxy solicitor, Alliance Advisors, LLC, at the following address, e-mail address or toll-free phone number: 200 Broadacres Drive, 3rd Floor, Bloomfield, New Jersey 07003, pcasey@allianceadvisors.com, (833) 670-0697.
CIT stockholders: If you have any questions about the mergers or how to submit your proxy or voting instruction card, or if you need additional copies of this document or the enclosed proxy card or voting instruction card, you should contact Investor Relations at One CIT Drive, Livingston, New Jersey 07039, (866) 542-4847, or CIT’s proxy solicitor, D.F. King & Co., Inc., at the following address, e-mail address or phone number: 48 Wall Street, 22nd Floor, New York, New York 10005, CIT@dfking.com, (800) 283-9185.
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SUMMARY
This summary highlights selected information in this joint proxy statement/prospectus and may not contain all of the information that is important to you. You should carefully read this entire joint proxy statement/prospectus and the other documents we refer you to for a more complete understanding of the matters being considered at the special meetings. In addition, we incorporate by reference important business and financial information about First Citizens and CIT into this joint proxy statement/prospectus. You may obtain the information incorporated by reference into this joint proxy statement/prospectus without charge by following the instructions in the section entitled “Where You Can Find More Information” beginning on page 183 of this joint proxy statement/prospectus.
The Parties to the Mergers
First Citizens
First Citizens BancShares, Inc.
4300 Six Forks Road
Raleigh, North Carolina 27609
(919) 716-7000
First Citizens BancShares, Inc. (“First Citizens”) is a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the “BHC Act”), headquartered in Raleigh, North Carolina. First Citizens was organized as a Delaware corporation on August 7, 1986. Through First Citizens’ wholly-owned subsidiary, First-Citizens Bank & Trust Company, a North Carolina state chartered bank (“First Citizens Bank”), First Citizens seeks to meet the financial needs of both individuals and commercial entities in its market areas through a wide range of retail and commercial banking services. First-Citizens Bank & Trust Company opened in 1898 as the Bank of Smithfield in Smithfield, North Carolina, and later changed its name to First-Citizens Bank & Trust Company. First Citizens has expanded through de novo branching and acquisitions and now operates in 19 states, providing a broad range of financial services to individuals, businesses and professionals. At September 30, 2020, First Citizens had total assets of $48.7 billion.
As a financial holding company registered under the BHC Act, First Citizens is subject to supervision, regulation and examination by the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”). First Citizens is also registered under the bank holding company laws of North Carolina and is subject to supervision, regulation and examination by the North Carolina Commissioner of Banks (“NCCOB”).
First Citizens’ principal office is located at 4300 Six Forks Road, Raleigh, North Carolina 27609, and its telephone number at that location is (919) 716-7000.
The Class A common stock, par value $1.00 per share, of First Citizens (the “First Citizens Class A common stock”) is traded on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “FCNCA” and its depositary shares, each representing a 1/40th interest in a share of 5.375% non-cumulative perpetual preferred stock, Series A, par value $0.01, of First Citizens, trade on Nasdaq under the symbol “FCNCP”. The Class B common stock, par value $1.00 per share, of First Citizens is traded on the over-the-counter market and is quoted on the OTC Bulletin Board under the symbol “FCNCB”.
For more information about First Citizens, see “Information about First Citizens” beginning on page 65 of this joint proxy statement/prospectus.
CIT
CIT Group Inc.
11 West 42nd Street
New York, New York 10036
(212) 461-5200
CIT Group Inc. (“CIT”) is a bank holding company and a financial holding company with total assets of $60.9 billion and total deposits of $44.7 billion at September 30, 2020. CIT was formed in 1908 and provides financing, leasing and advisory services principally to middle-market companies and small businesses in a wide
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variety of industries, primarily in North America. CIT also provides banking and related services to commercial and individual customers through its banking subsidiary, CIT Bank, N.A. (“CIT Bank”), which includes a national online bank platform and a regional branch network of approximately 90 branches, including over 60 branches located in Southern California.
CIT is regulated by the Federal Reserve Board and the Federal Reserve Bank of New York under the BHC Act. CIT Bank is regulated by the Office of the Comptroller of the Currency of the U.S. Department of the Treasury (the “OCC”). In addition, CIT Bank, as an insured depository institution, is supervised by the Federal Deposit Insurance Corporation (“FDIC”).
CIT’s principal office is located at 11 West 42nd Street, New York, New York 10036, and its telephone number at that location is (212) 461-5200.
The common stock, par value $0.01 per share, of CIT (the “CIT common stock”) is traded on the New York Stock Exchange (the “NYSE”) under the symbol “CIT” and the 5.625% non-cumulative perpetual preferred stock, Series B, par value $0.01 per share, of CIT (the “CIT series B preferred stock”) is traded on the NYSE under the symbol “CITPRB”.
For more information about CIT, see “Information about CIT” beginning of page 66 of this joint proxy statement/prospectus.
Merger Sub
FC Merger Subsidiary IX, Inc.
c/o First Citizens BancShares, Inc.
4300 Six Forks Road
Raleigh, North Carolina 27609
(919) 716-7000
FC Merger Subsidiary IX, Inc. (“Merger Sub”) is a Delaware corporation and a direct wholly-owned subsidiary of First Citizens Bank. Merger Sub was incorporated on October 15, 2020, for the sole purpose of effecting the transactions contemplated by the merger agreement (as defined below). As of the date of this joint proxy statement/prospectus, Merger Sub has not conducted any activities other than those incidental to its formation, the execution of the merger agreement and the transactions contemplated by the merger agreement.
First Citizens Bank
First-Citizens Bank & Trust Company
4300 Six Forks Road
Raleigh, North Carolina 27609
(919) 716-7000
First-Citizens Bank & Trust Company (“First Citizens Bank”) is the banking subsidiary of First Citizens. First Citizens Bank opened in 1898 as the Bank of Smithfield in Smithfield, North Carolina, and later changed its name to First-Citizens Bank & Trust Company.
As of September 30, 2020, First Citizens Bank operated 558 branches in South Carolina, Wisconsin, North Carolina, Virginia, West Virginia, Maryland, Tennessee, Washington, California, Florida, Georgia, Texas, Arizona, New Mexico, Oregon, Colorado, Oklahoma, Kansas and Missouri.
CIT Bank
CIT Bank, N.A.
75 North Fair Oaks Avenue
Pasadena, California 91103
Los Angeles County
CIT Bank is the banking subsidiary of CIT. CIT Bank provides banking and related services to commercial and individual customers through a national online bank platform and a regional branch network of approximately 90 branches, including over 60 branches in Southern California operating under the trade name OneWest Bank. CIT Bank provides lending, leasing, deposit and other financial and advisory services, primarily to small and
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middle market companies across select industries through the commercial finance, rail, real estate finance, and business capital divisions of its commercial banking segments. CIT Bank also offers residential mortgage lending and deposits to its individual customers through its consumer banking segment.
The Mergers and the Merger Agreement
On October 15, 2020, First Citizens, First-Citizens Bank, Merger Sub and CIT entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”) that provides for the combination of First Citizens and CIT, with First Citizens as the surviving parent entity (which we refer to as the “combined company” or “First Citizens”, as the case may be). Under the merger agreement, (i) Merger Sub will merge with and into CIT (which we refer to as the “first step merger”), with CIT surviving the first step merger and becoming a wholly-owned subsidiary of First Citizens Bank (we refer to CIT, in such capacity, as the “interim surviving entity”) and (ii) as soon as reasonably practicable following the first step merger, and as part of a single integrated transaction, the interim surviving entity will merge with and into First Citizens Bank, with First Citizens Bank surviving (which we refer to as the “second step merger”). Immediately following the second step merger, CIT Bank will merge with and into First Citizens Bank, and First Citizens Bank will continue as the surviving bank (such steps, collectively referred to herein as the “mergers”). Following the mergers, (1) CIT common stock and CIT series B preferred stock will be delisted from the NYSE and will cease to be publicly traded and (2) CIT common stock, CIT series A preferred stock and CIT series B preferred stock will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
The terms and conditions of the mergers are contained in the merger agreement, a copy of which is attached as Annex A to this joint proxy statement/prospectus. You are encouraged to read the merger agreement carefully and in its entirety, as it is the primary legal document that governs the mergers.
Merger Consideration
In the first step merger, holders of CIT common stock will receive 0.06200 shares (the “exchange ratio” and such shares, the “merger consideration”) of First Citizens Class A common stock for each share of CIT common stock they hold immediately prior to the effective time of the first step merger (the “effective time”). First Citizens will not issue any fractional shares of First Citizens common stock in the first step merger. Holders of CIT common stock who would otherwise be entitled to a fraction of a share of First Citizens Class A common stock in the first step merger will instead receive, for the fraction of a share, an amount in cash (rounded to the nearest cent) based on the average of the closing-sale prices per share of First Citizens Class A common stock on Nasdaq as reported by The Wall Street Journal for the consecutive period of twenty (20) full trading days ending on and including the business day that is two (2) business days immediately prior to the date on which the closing of the transactions contemplated by the merger agreement occurs (the “closing” and such date, the “closing date”).
First Citizens Class A common stock is listed on Nasdaq under the symbol “FCNCA”, and CIT common stock is listed on the NYSE under the symbol “CIT”. The following table shows the closing sale prices of First Citizens Class A common stock and CIT common stock as reported on Nasdaq and the NYSE, respectively, on October 15, 2020, the last full trading day before the public announcement of the merger agreement, and on December 18, 2020, the last practicable trading day before the date of this joint proxy statement/prospectus. This table also shows the implied value of the merger consideration to be issued in exchange for each share of CIT common stock, which was calculated by multiplying the closing price of First Citizens Class A common stock on those dates by the exchange ratio of 0.06200.
 
First
Citizens
Class A
Common
Stock
CIT
Common
Stock
Implied
Value of
One
Share of
CIT
Common
Stock
October 15, 2020
$353.32
$19.74
$21.91
December 18, 2020
$585.26
$36.51
$36.29
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For more information on the exchange ratio, see the section entitled “The Mergers—Terms of the Mergers” beginning on page 67 and the section entitled “The Merger Agreement—Merger Consideration” beginning on page 132.
Treatment of CIT Preferred Stock
In the first step merger, each share of fixed-to-floating rate non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of CIT (“CIT series A preferred stock”) and 5.625% non-cumulative perpetual preferred stock, Series B, par value $0.01 per share, of CIT (“CIT series B preferred stock”) issued and outstanding immediately prior to the effective time will be converted into the right to receive one (1) share of newly created fixed-to-floating rate non-cumulative perpetual preferred stock, Series B, par value $0.01, of First Citizens (the “First Citizens series B preferred stock”) and one (1) share of newly created 5.625% non-cumulative perpetual preferred stock, Series C, par value $0.01, of First Citizens (“First Citizens series C preferred stock” and, together with the First Citizens series B preferred stock, the “new First Citizens preferred stock”), respectively. The First Citizens series B preferred stock and First Citizens series C preferred stock will have such rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, that are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, of the CIT series A preferred stock and CIT series B preferred stock, respectively (taking into account (i) that CIT will not be the surviving entity in the mergers and (ii) any adjustment to the existing right of optional redemption associated with each series of CIT preferred stock by First Citizens that is reasonably necessary to obtain Tier 1 Capital treatment from the Board of Governors of the Federal Reserve System for such preferred stock). The CIT series B preferred stock is currently listed on the NYSE under the symbol “CITPRB”. The shares of First Citizens series C preferred stock are expected to be listed on Nasdaq upon completion of the mergers.
For further information, see the section entitled “The Mergers—Treatment of CIT Preferred Stock” beginning on page 129 and the section entitled “Description of New First Citizens Preferred Stock” beginning on page 152.
Treatment of CIT Equity Awards
CIT RSUs
At the effective time, except as otherwise agreed by First Citizens and CIT, each outstanding CIT RSU, other than a CIT Director RSU, will, automatically and without any required action on the part of the holder thereof, be converted into a number of restricted stock units in respect of shares of First Citizens Class A common stock equal to the product (with the result rounded up to the nearest whole share) of (i) the number of shares of CIT common stock subject to each such CIT RSU as of immediately prior to the effective time determined based on target level performance (to the extent applicable) multiplied by (ii) the exchange ratio. Each converted award will in all other respects be subject to the same terms and conditions (including vesting terms, payment timing and rights to receive dividend equivalents) applicable to the existing CIT RSU under the applicable equity plan and award agreement as in effect immediately prior to the effective time.
CIT Director RSUs
At the effective time, except as otherwise agreed by First Citizens and CIT, each outstanding CIT Director RSU that is not subject to a deferral election, will, in accordance with its terms, at the effective time, automatically and without any required action on the part of the holder thereof, be converted into the right to receive the merger consideration in respect of the number of shares of CIT common stock subject to such CIT Director RSU, less applicable tax withholding (if any), which will be delivered as soon as reasonably practicable following the closing date and in no event later than five (5) days following the closing date.
CIT PSUs
At the effective time, except as otherwise agreed by First Citizens and CIT, each outstanding CIT PSU will, automatically and without any required action on the part of the holder thereof, be converted into a number of restricted stock units in respect of shares of First Citizens Class A common stock equal to the product (with the result rounded up to the nearest whole share) of (i) the number of shares of CIT common stock subject to each such CIT PSU as of immediately prior to the effective time determined based on target level performance multiplied by (ii) the exchange ratio. Each converted award will in all other respects be subject to the same terms
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and conditions (including rights to receive dividend equivalents) applicable to the existing CIT PSU under the applicable equity plan and award agreement as in effect immediately prior to the effective time, provided that vesting will be subject only to continued service of the holder through each applicable final performance date and will not be subject to any performance goals or metrics following the effective time.
Treatment of CIT ESPP
The CIT board of directors (or appropriate committee with delegated authority thereof) will take all necessary actions to ensure that (i) the final offering under the CIT ESPP will end at least five (5) business days prior to the closing date of the mergers, (ii) each individual participating in the final offering will receive notice of the mergers no later than 15 days prior to the closing date, (iii) each CIT ESPP participant’s accumulated contributions under the CIT ESPP will be refunded to such participant as soon as practicable following the effective time and will not be used to purchase shares of CIT common stock, and (iv) the CIT ESPP will terminate in its entirety at the effective time and no further rights will be granted or exercised under the CIT ESPP thereafter.
Material U.S. Federal Income Tax Consequences of the First Step and Second Step Merger
The mergers have been structured to qualify as a reorganization for federal income tax purposes, and it is a condition to our respective obligations to complete the mergers that First Citizens and CIT each receive a legal opinion to the effect that the mergers will so qualify. Assuming the receipt and accuracy of these opinions, holders of CIT common stock and holders of CIT preferred stock generally will not recognize any gain or loss for U.S. federal income tax purposes on the exchange of their CIT common stock for First Citizens Class A common stock and new First Citizens preferred stock, respectively, in the first step merger, except for any gain or loss that may result from the receipt of cash instead of a fractional share of First Citizens Class A common stock.
You should be aware that the tax consequences to you of the mergers may depend upon your own situation. In addition, you may be subject to state, local or foreign tax laws that are not discussed in this joint proxy statement/prospectus. You should therefore consult with your own tax advisor for a full understanding of the tax consequences to you of the mergers.
First Citizens’ Reasons for the Mergers; Recommendation of First Citizens’ Board of Directors
The First Citizens board of directors has determined that the mergers, the merger agreement and the transactions contemplated by the merger agreement are advisable and in the best interests of First Citizens and its stockholders and has unanimously adopted and approved the merger agreement, the mergers and the other transactions contemplated by the merger agreement. The First Citizens board of directors unanimously recommends that holders of First Citizens common stock vote “FOR” the issuance of First Citizens Class A common stock and “FOR” the other proposals presented at the First Citizens special meeting. For a more detailed discussion of the First Citizens board of directors’ recommendation, see the section entitled “The Mergers—First Citizens’ Reasons for the Mergers; Recommendation of First Citizens’ Board of Directors” beginning on page 77.
CIT’s Reasons for the Mergers; Recommendation of CIT’s Board of Directors
The CIT board of directors has determined that the mergers, the merger agreement and the transactions contemplated by the merger agreement are advisable and in the best interests of CIT and its stockholders and has unanimously approved and adopted the merger agreement, the mergers and the other transactions contemplated by the merger agreement. The CIT board of directors unanimously recommends that holders of CIT common stock vote “FOR” the adoption of the merger agreement and “FOR” the other proposals presented at the CIT special meeting. For a more detailed discussion of the CIT board of directors’ recommendation, see the section entitled “The Mergers—CIT’s Reasons for the Mergers; Recommendation of CIT’s Board of Directors” beginning on page 89.
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Opinion of First Citizens’ Financial Advisor
Piper Sandler & Co. At the October 15, 2020 meeting at which First Citizens’ board of directors considered the mergers and the merger agreement, Piper Sandler & Co. (“Piper Sandler”) delivered to the board of directors its oral opinion, which was subsequently confirmed in writing on October 15, 2020, to the effect that, as of such date, the exchange ratio was fair to First Citizens from a financial point of view. The full text of Piper Sandler’s opinion is attached as Annex C to this joint proxy statement/prospectus. The opinion outlines the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Piper Sandler in rendering its opinion. The description of the opinion set forth below is qualified in its entirety by reference to the full text of the opinion. Holders of First Citizens common stock are urged to read the entire opinion carefully in connection with their consideration of the proposed mergers and the First Citizens stock issuance proposal. Piper Sandler’s opinion was directed to the board of directors of First Citizens in connection with its consideration of the mergers and the merger agreement and does not constitute a recommendation to any stockholder of First Citizens as to how any such stockholder should vote at any meeting of stockholders called to consider and vote upon the approval of the First Citizens stock issuance proposal.
Opinions of CIT’s Financial Advisors
Keefe, Bruyette & Woods, Inc. CIT engaged Keefe, Bruyette & Woods, Inc. (“KBW”) to render financial advisory and investment banking services to CIT, including an opinion to the CIT board of directors as to the fairness, from a financial point of view, to the holders of CIT common stock of the exchange ratio in the first step merger. CIT selected KBW because KBW is a nationally recognized investment banking firm with substantial experience in transactions similar to the mergers. As part of its engagement, representatives of KBW participated telephonically in the meeting of the CIT board of directors held on October 15, 2020, at which the CIT board of directors evaluated the proposed mergers. At this meeting, KBW rendered to the CIT board of directors an opinion to the effect that, as of such date and subject to the procedures followed, assumptions made, matters considered, and qualifications and limitations on the review undertaken by KBW as set forth in its opinion, the exchange ratio in the first step merger was fair, from a financial point of view, to the holders of CIT common stock. The description of the opinion set forth herein is qualified in its entirety by reference to the full text of the opinion, which is attached as Annex D to this joint proxy statement/prospectus and is incorporated herein by reference, and describes the procedures followed, assumptions made, matters considered, and qualifications and limitations on the review undertaken by KBW in preparing the opinion.
KBW’s opinion speaks only as of the date of the opinion. The opinion was for the information of, and was directed to, the CIT board of directors (in its capacity as such) in connection with its consideration of the financial terms of the first step merger. The opinion addressed only the fairness, from a financial point of view, of the exchange ratio in the first step merger to the holders of CIT common stock. It did not address the underlying business decision of CIT to engage in the first step merger or enter into the merger agreement or constitute a recommendation to the CIT board of directors in connection with the first step merger, and it does not constitute a recommendation to any holder of CIT common stock or any stockholder of any other entity as to how to vote in connection with the first step merger or any other matter, nor does it constitute a recommendation regarding whether or not any such stockholder should enter into a voting, stockholders’, or affiliates’ agreement with respect to the first step merger or exercise any dissenters’ or appraisal rights that may be available to such stockholder. For more information, see The Mergers—Opinions of CIT’s Financial Advisors—Opinion of Keefe, Bruyette & Woods, Inc.” beginning on page 92 and Annex D.
Morgan Stanley & Co. LLC. CIT retained Morgan Stanley & Co. LLC (“Morgan Stanley”) to provide it with financial advisory services in connection with a possible transaction with First Citizens, and, if requested by CIT, a financial opinion with respect thereto. CIT selected Morgan Stanley to act as one of its financial advisors based on Morgan Stanley’s qualifications, expertise and reputation and its knowledge of the business and affairs of CIT. Morgan Stanley rendered to the CIT board of directors at its special meeting on October 15, 2020, its oral opinion, subsequently confirmed by delivery of a written opinion dated October 15, 2020, that, as of such date, and based upon and subject to the various assumptions made, procedures followed, matters considered, and qualifications and limitations on the scope of review undertaken by Morgan Stanley as set forth therein, the exchange ratio pursuant to the merger agreement was fair, from a financial point of view, to holders of shares of CIT common stock (other than shares held by CIT or First Citizens (in each case other than shares of CIT
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common stock (i) held in trust accounts, managed accounts, mutual funds and the like, or otherwise held in a fiduciary or agency capacity that are beneficially owned by third parties or (ii) held, directly or indirectly, by CIT or First Citizens in respect of debts previously contracted) (collectively, “excluded shares”)).
The full text of the written opinion of Morgan Stanley, dated October 15, 2020, is attached as Annex E and incorporated by reference into this joint proxy statement/prospectus. The opinion sets forth, among other things, the assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review undertaken by Morgan Stanley in rendering its opinion. Stockholders are urged to, and should, read the opinion carefully and in its entirety. Morgan Stanley’s opinion is directed to the CIT board of directors and addresses only the fairness, from a financial point of view, to holders of shares of CIT common stock (other than holders of excluded shares) of the exchange ratio pursuant to the merger agreement as of the date of the opinion. Morgan Stanley’s opinion does not address any other aspect of the transactions contemplated by the merger agreement and does not constitute a recommendation to stockholders of CIT or stockholders of First Citizens as to how to vote at any stockholders meetings held with respect to the first step merger or any other matter or whether to take any other action with respect to the first step merger. The summary of Morgan Stanley’s opinion set forth in this joint proxy statement/prospectus is qualified in its entirety by reference to the full text of the opinion. In addition, the opinion does not in any manner address the price at which First Citizens Class A common stock will trade following the consummation of the first step merger or at any time. For more information, see “The Mergers—Opinions of CIT’s Financial Advisors—Opinion of Morgan Stanley & Co. LLCbeginning on page 107 and Annex E.
Appraisal or Dissenters’ Rights in the Mergers
Holders of First Citizens common stock and First Citizens series A preferred stock are not entitled to appraisal or dissenters’ rights under the Delaware General Corporation Law (the “DGCL”) and holders of CIT common stock and CIT preferred stock are not entitled to appraisal or dissenters’ rights under the DGCL. For more information, see the section entitled “The Mergers—Appraisal or Dissenters’ Rights in the Mergers” beginning on page 129.
Interests of First Citizens’ Directors and Executive Officers in the Mergers
In considering the recommendation of the First Citizens board of directors to vote for the First Citizens stock issuance proposal, holders of First Citizens common stock should be aware that the directors and executive officers of First Citizens may have interests in the mergers that are different from, or in addition to, the interests of holders of First Citizens common stock generally and that may create potential conflicts of interest. The First Citizens board of directors was aware of these interests and considered them, among other matters, in making its recommendation that First Citizens stockholders vote to approve the First Citizens stock issuance proposal.
These interests include:
Certain of First Citizens’ directors and executive officers will continue to serve as directors or executive officers, as applicable, of the combined company following the closing of the mergers; and
First Citizens’ directors and executive officers are entitled to continued indemnification and insurance coverage under their existing agreements with First Citizens.
The First Citizens board of directors was aware of and considered these respective interests when deciding to adopt and approve the merger agreement. For more information, see the section entitled “The Mergers—Interests of First Citizens’ Directors and Executive Officers in the Mergers” beginning on page 120.
Interests of CIT’s Directors and Executive Officers in the Mergers
In considering the recommendation of the CIT board of directors to vote for the CIT merger proposal, holders of CIT common stock should be aware that the directors and executive officers of CIT may have interests in the mergers that are different from, or in addition to, the interests of holders of CIT common stock generally and that may create potential conflicts of interest. The CIT board of directors was aware of these interests and considered them, among other matters, in making its recommendation that CIT stockholders vote to approve the CIT merger proposal.
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These interests include:
Unvested CIT equity awards held by the CIT non-employee directors that are not subject to a deferral election will automatically vest at the effective time in accordance with their terms and automatically be converted into the right to receive the merger consideration;
First Citizens has entered into an employment letter agreement with Ms. Ellen Alemany that will be effective at the closing of the mergers and provide Ms. Alemany with (i) an annualized base salary of $1,000,000, (ii) a guaranteed annual bonus of $6,850,000 at the conclusion of each 12-month period during the two year period immediately following the closing of the mergers, and (iii) a retention bonus of $13,000,000, payable in a lump sum following the second anniversary of the closing of the mergers in lieu of all compensation and benefits which she would otherwise have been entitled to receive upon a qualifying termination under existing severance arrangements with CIT;
First Citizens has also entered into retention letter agreements with Mr. David Harnisch and one other executive officer that will be effective at the closing of the mergers and provide certain compensation and benefits in connection with such executives’ employment following the effective time;
Certain of CIT’s executive officers are party to letter agreements with CIT that clarify certain provisions of the CIT Group Inc. Employee Severance Plan, providing for, among other things, benefits upon both a change in control and a subsequent qualifying termination;
At the closing of the mergers, certain of CIT’s directors and executive officers will continue to serve as directors or executive officers, as applicable, of the combined company; and
CIT directors and executive officers are entitled to continued indemnification and insurance coverage under the merger agreement.
The CIT board of directors was aware of and considered these respective interests when deciding to adopt the merger agreement. For more information, see the section entitled “The Mergers—Interests of CIT’s Directors and Executive Officers in the Mergers” beginning on page 121.
Governance of the Combined Company After the Mergers
Board of Directors
The board of directors of the combined company and the combined bank as of the effective time will have fourteen (14) members, consisting of:
eleven (11) current First Citizens directors, which will include Frank B. Holding, Jr., the current Chairman and Chief Executive Officer of First Citizens; and
three (3) current CIT directors, which will include Ellen R. Alemany, the current Chairwoman and Chief Executive Officer of CIT.
Immediately following the completion of the mergers, the board of directors of the combined company and the combined bank is expected to consist of Frank B. Holding, Jr., the current Chairman and Chief Executive Officer of First Citizens; John M. Alexander, Jr., Victor E. Bell, III, Peter M. Bristow, Hope H. Bryant, H. Lee Durham, Jr., Daniel L. Heavner, Robert R. Hoppe, Floyd L. Keels, Robert E. Mason IV, and Robert T. Newcomb, each a current director of First Citizens; Ellen R. Alemany, the current Chairwoman and Chief Executive Officer of CIT; and Michael A. Carpenter and Vice Admiral John R. Ryan, USN (Ret.), each a current director of CIT.
As of the date of this joint proxy statement/prospectus, First Citizens currently has eleven (11) members on its board of directors.
Chairman and Chief Executive Officer, Vice Chairwoman
Effective as of the effective time, Mr. Holding will continue to serve as Chairman and Chief Executive Officer of the combined company and the combined bank, and Ms. Alemany will serve as Vice Chairwoman of First Citizens Bank.
Ms. Alemany will be employed by First Citizens Bank through the second anniversary of the closing date of the mergers (the “Term”), however, after the initial 6 months of the Term, First Citizens Bank may remove
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Ms. Alemany from the Vice Chairwoman position, assuming she and the Chief Executive Officer of First Citizens Bank mutually agree that successful integration of CIT and First Citizens is sufficiently assured such that Ms. Alemany’s service in that position is no longer necessary, after which she will continue in employment for the remainder of the two-year term as Special Advisor to the Chairman of the Board and Chief Executive Officer. If Ms. Alemany is removed from the Vice Chairwoman position, she will also resign from the Boards of Directors of First Citizens and First Citizens Bank.
Headquarters and Name After the Mergers
Following the closing of the mergers, the corporate headquarters of the combined company and the combined bank will be located in Raleigh, North Carolina, the name of the combined company will be “First Citizens BancShares, Inc.” and the name of the combined bank will be “First-Citizens Bank & Trust Company”.
Regulatory Approvals
Subject to the terms of the merger agreement, First Citizens and CIT have agreed to cooperate with each other and use reasonable best efforts to promptly prepare and file all documentation to obtain as promptly as practicable all permits, consents, approvals and authorizations of all third parties and governmental entities which are necessary or advisable to consummate the transactions contemplated by the merger agreement (including the first step merger and the bank merger), and to comply with the terms and conditions of all such permits, consents, approvals and authorizations of all such governmental entities. These approvals include, among others, the approval of the Federal Reserve Board, the FDIC and the NCCOB. The initial filings of the applications for these approvals occurred on December 8, 2020.
Although neither First Citizens nor CIT knows of any reason why it cannot obtain these regulatory approvals in a timely manner, First Citizens and CIT cannot be certain when or if they will be obtained, or that the granting of these regulatory approvals will not involve the imposition of conditions on the completion of the first step merger or the bank merger.
The review of the merger applications by the Federal Reserve Board, the FDIC and the NCCOB will not include an evaluation of the proposed mergers from the financial perspective of the individual stockholders of CIT. Further, no stockholder should construe an approval of the merger applications by the Federal Reserve Board, the FDIC or the NCCOB to be a recommendation that the holders of CIT common stock vote to approve the CIT merger proposal.
Expected Timing of the Mergers
First Citizens and CIT expect the mergers to close in the first half of 2021. However, neither First Citizens nor CIT can predict the actual date on which the mergers will be completed, or if the mergers will be completed at all, because completion is subject to conditions and factors outside the control of both companies. First Citizens and CIT must first obtain the approval of holders of First Citizens common stock for the First Citizens stock issuance proposal and holders of CIT common stock for the mergers, as well as obtain necessary regulatory approvals and satisfy certain other closing conditions.
Conditions to Completion of the Mergers
As more fully described in this joint proxy statement/prospectus and in the merger agreement, the completion of the mergers depends on a number of conditions being satisfied or, where legally permissible, waived. These conditions include:
adoption of the merger agreement by the stockholders of CIT;
approval of the issuance of the shares of First Citizens Class A common stock by the stockholders of First Citizens;
authorization for listing on Nasdaq, subject to official notice of issuance, of the shares of First Citizens Class A common stock and shares of the newly created First Citizens series C preferred stock to be issued pursuant to the merger agreement;
all regulatory authorizations, consents, orders and approvals from (and the expiration or termination of all statutory waiting periods in respect thereof) the Financial Industry Regulatory Authority (“FINRA”),
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the Federal Reserve Board or the relevant Federal Reserve Banks acting under delegated authority, the FDIC, the Antitrust Division of the US Department of Justice, the NCCOB, and such other approvals the failure of which to be obtained would reasonably be expected to have, individually or in the aggregate, a material adverse effect on First Citizens or the combined bank (the “requisite regulatory approvals”) having been obtained and remaining in full force and effect, and all statutory waiting periods in respect thereof having expired or been terminated, without the imposition of any materially burdensome regulatory condition;
effectiveness of the registration statement of which this joint proxy statement/prospectus is a part, and the absence of any stop order suspending the effectiveness of the registration statement, or proceedings for such purpose initiated or threatened by the SEC and not withdrawn;
no order, injunction or other legal restraint preventing the consummation of the mergers or making the completion of the first step merger, the second step merger, the bank merger or the other transactions contemplated by the merger agreement illegal;
subject to materiality standards provided in the merger agreement, the accuracy of the representations and warranties of First Citizens and CIT in the merger agreement;
performance in all material respects by each of First Citizens and CIT of their respective obligations, covenants and agreements under the merger agreement; and
receipt by each of First Citizens and CIT of an opinion from counsel as to certain tax matters.
Termination of the Merger Agreement
The merger agreement may be terminated at any time prior to the completion of the first step merger, in the following circumstances:
by mutual written consent of First Citizens and CIT;
by either First Citizens or CIT if any governmental entity that must grant a requisite regulatory approval has denied approval of the first step merger, the second step merger or the bank merger and such denial has become final and nonappealable or any governmental entity of competent jurisdiction has issued a final and nonappealable order, injunction, decree or other legal restraint or prohibition permanently enjoining or otherwise prohibiting or making illegal the completion of the first step merger, the second step merger or the bank merger, unless the failure to obtain a requisite regulatory approval is due to the failure of the party seeking to terminate the merger agreement to perform or observe its obligations, covenants and agreements under the merger agreement;
by either First Citizens or CIT if the first step merger has not been completed on or before October 15, 2021 (the “termination date”), unless the failure of the first step merger to be completed by such date is due to the failure of the party seeking to terminate the merger agreement to perform or observe its obligations, covenants and agreements under the merger agreement;
by either First Citizens or CIT (provided that the terminating party is not then in material breach of any representation, warranty, obligation, covenant or other agreement contained in the merger agreement) if there is a breach of any of the obligations, covenants or agreements or any of the representations or warranties (or any such representation or warranty ceases to be true) set forth in the merger agreement on the part of CIT, in the case of a termination by First Citizens, or First Citizens, in the case of a termination by CIT, which breach or failure to be true, either individually or in the aggregate with all other breaches by such party (or failures of such representations or warranties to be true), would constitute, if occurring or continuing on the closing date, the failure of an applicable closing condition of the terminating party and which is not cured within forty-five (45) days following written notice to the other party, or by its nature or timing cannot be cured during such period (or such fewer days as remain prior to the termination date);
by either First Citizens or CIT if: (1) the adoption of the merger agreement by the stockholders of CIT has not been obtained at the CIT special meeting or at any adjournment or postponement thereof taken
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in accordance with the merger agreement or (2) the approval of the issuance of the shares of First Citizens Class A common stock by the stockholders of First Citizens has not been obtained at the First Citizens special meeting or at any adjournment or postponement taken in accordance with the merger agreement;
by either First Citizens or CIT if, prior to obtaining the requisite vote from their respective stockholders, the CIT board of directors or the First Citizens board of directors authorizes CIT or First Citizens, respectively, to enter into an alternative acquisition agreement in response to a superior proposal;
by either First Citizens or CIT if, prior to obtaining the requisite vote from their respective stockholders, the CIT board of directors or the First Citizens board of directors, respectively, has made a recommendation change or breaches in any material respect its obligations relating to non-solicitation of acquisition proposals or its obligations related to stockholder approval and the board of directors’ recommendation.
Termination Fee
If the merger agreement is terminated by either First Citizens or CIT under certain circumstances, including circumstances involving alternative acquisition proposals and changes in the recommendation of First Citizens’ or CIT’s respective boards, CIT or First Citizens may be required to pay a termination fee to the other party equal to $64 million.
Voting Agreement
Contemporaneously with the execution of the merger agreement, (i) Mr. Frank B. Holding, Jr., the Chairman and Chief Executive Officer of First Citizens, (ii) Ms. Hope Bryant, the Vice Chairman of First Citizens and sister of Mr. Holding, (iii) Mr. Peter M. Bristow, the President of First Citizens and brother-in-law of Mr. Holding and Mrs. Bryant and (iv) Mrs. Claire H. Bristow, Mr. Bristow’s spouse and sister of Mr. Holding and Mrs. Bryant, have entered into a voting agreement with CIT, solely in their respective capacity as stockholders of First Citizens, pursuant to which each has agreed, among other things, to vote in favor of the First Citizens stock issuance proposal and the First Citizens adjournment proposal, as well as certain other customary restrictions with respect to the voting of their respective shares of First Citizens common stock. As of December 18, 2020, the last date before the date of this joint proxy statement/prospectus for which it was practicable to obtain this information, these stockholders collectively had sole voting rights over 1,584,972 shares of First Citizens Class A common stock and 360,252 shares of First Citizens Class B common stock, representing approximately 29.52% of the voting power of First Citizens’ common stock outstanding on that date. A copy of the voting agreement is attached as Annex B to the accompanying joint proxy statement/prospectus.
Accounting Treatment
First Citizens and CIT each prepare their respective financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”). With the transaction structured as a merger of equals, GAAP requires that one of the combining entities be identified as the acquirer. The mergers will be accounted for using the acquisition method of accounting, and First Citizens will be treated as the accounting acquirer. In a business combination effected primarily by transferring cash or stock, the entity that transfers the cash or stock is generally the acquirer. In identifying First Citizens as the acquiring entity for accounting purposes, a number of factors were considered, including the legal acquirer, the entity issuing stock, the surviving entity, the relative voting rights of all equity instruments in the combined company, the intended corporate governance structure of the combined company and the terms of the exchange of equity securities pursuant to the merger agreement. No single factor was the sole determinant in the overall conclusion that First Citizens is the acquirer for accounting purposes; rather, all factors were considered in arriving at such conclusion.
The Rights of Holders of CIT Common Stock Will Change as a Result of the First Step Merger
The rights of holders of CIT common stock are governed by Delaware law and by the restated certificate of incorporation of CIT (the “CIT certificate”) and the amended and restated bylaws of CIT (the “CIT bylaws”). Pursuant to the merger agreement, holders of CIT common stock will become holders of Class A common stock of the combined company, and their rights will be governed by Delaware law and the certificate of incorporation and bylaws of First Citizens. Holders of CIT common stock will have different rights once they become holders
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of Class A common stock of the combined company due to differences between the CIT governing documents, on the one hand, and the First Citizens governing documents, on the other hand. These differences are described in more detail under the section entitled “Comparison of Stockholders’ Rights” beginning on page 166.
Listing of First Citizens Class A Common Stock and First Citizens Series C Preferred Stock; Delisting of CIT Common Stock and CIT Series B Preferred Stock and Deregistration of CIT Common Stock, CIT Series A Preferred Stock and CIT Series B Preferred Stock
The shares of First Citizens Class A common stock and First Citizens series C preferred stock to be issued in the mergers will be listed for trading on Nasdaq. Following the mergers, shares of First Citizens Class A common stock will continue to be listed on Nasdaq. Following the mergers, (1) CIT common stock and CIT series B preferred stock will be delisted from the NYSE and will cease to be publicly traded and (2) the CIT common stock, CIT series A preferred stock and CIT series B preferred stock will be deregistered under the Exchange Act.
The First Citizens Special Meeting
The First Citizens special meeting will be held virtually at the following website: www.virtualshareholdermeeting.com/FIZN2021 on February 9, 2021, at 10:00 a.m., local time. At the First Citizens special meeting, holders of First Citizens common stock will be asked to vote on the following matters:
approve the First Citizens stock issuance proposal; and
approve the First Citizens adjournment proposal.
You may vote at the First Citizens special meeting if you own shares of First Citizens common stock at the close of business on December 30, 2020. As of December 18, 2020, the last date before the date of this joint proxy statement/prospectus for which it was practicable to obtain this information, there were 8,811,220 shares of First Citizens Class A common stock outstanding, approximately 19.50% of which were owned and entitled to be voted by First Citizens directors and executive officers and their affiliates and 1,005,185 shares of First Citizens Class B common stock outstanding, approximately 41.41% of which were owned and entitled to be voted by First Citizens directors and executive officers and their affiliates. In addition, Mr. Frank B. Holding, Jr., Ms. Hope H. Bryant, Mr. Peter M. Bristow and Mrs. Claire H. Bristow held shares of Class A common stock of First Citizens and Class B common stock of First Citizens that represented approximately 29.52% of the voting power of First Citizens common stock as of the close of business on December 18, 2020, the last date before the date of this joint proxy statement/prospectus for which it was practicable to obtain this information. Each of Mr. Frank B. Holding, Jr., Ms. Hope H. Bryant, Mr. Peter M. Bristow and Mrs. Claire H. Bristow has entered into a voting agreement with CIT, solely in their respective capacity as a stockholder of First Citizens and not, where applicable, as members of First Citizens’ board of directors, pursuant to which each has agreed, among other things, to vote in favor of the First Citizens stock issuance proposal and the First Citizens adjournment proposal, as well as certain other customary restrictions with respect to the voting of their respective shares of First Citizens common stock. We currently expect that the other 8 members of the First Citizens board of directors and First Citizens’ executive officers will vote their shares in favor of the First Citizens stock issuance proposal and the other proposals to be considered at the First Citizens special meeting, although none of them has entered into any agreements obligating them to do so.
The First Citizens stock issuance proposal and First Citizens adjournment proposal will be approved if a majority of the total votes cast are voted in favor of such proposal. An abstention or a broker non-vote or other failure to vote or be present will have no effect on the outcome of the First Citizens stock issuance proposal or First Citizens adjournment proposal.
The CIT Special Meeting
The CIT special meeting will be held virtually at the following website: www.virtualshareholdermeeting.com/CIT2021SM on February 9, 2021, at 10:00 a.m., local time. At the CIT special meeting, holders of CIT common stock will be asked to vote on the following matters:
approve the CIT merger proposal;
approve, on an advisory (non-binding) basis, the CIT compensation proposal; and
approve the CIT adjournment proposal.
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You may vote at the CIT special meeting if you own shares of CIT common stock at the close of business on December 30, 2020. As of December 18, 2020, the last date before the date of this joint proxy statement/prospectus for which it was practicable to obtain this information, there were 98,537,761 shares of CIT common stock outstanding, less than one percent (1%) of which were owned and entitled to be voted by CIT directors and executive officers and their affiliates. We currently expect that CIT’s directors and executive officers will vote their shares in favor of the merger agreement and the other proposals to be considered at the CIT special meeting, although none of them has entered into any agreements obligating them to do so.
The CIT merger proposal will be approved if a majority of the outstanding shares of CIT common stock entitled to vote on such proposal are voted in favor of such proposal. The CIT compensation proposal and the CIT adjournment proposal will each be approved if the holders of a majority of the shares of CIT common stock entitled to vote, represented at the CIT special meeting, are voted in favor of such proposal. If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the CIT special meeting or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the CIT merger proposal, it will have the same effect as a vote “AGAINST” the CIT merger proposal. If you mark “ABSTAIN” on your proxy with respect to the CIT compensation proposal or the CIT adjournment proposal, fail to submit a proxy or vote at the CIT special meeting or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the CIT compensation proposal or the CIT adjournment proposal, you will not be deemed to have cast a vote with respect to the proposal and it will have no effect on the outcome of the proposal.
Risk Factors
In evaluating the merger agreement and the mergers, including the issuance of shares of First Citizens Class A common stock in the mergers, you should carefully read this joint proxy statement/prospectus and give special consideration to the factors discussed in the section entitled “Risk Factors” beginning on page 43 and in First Citizens’ and CIT’s respective Annual Reports on Form 10-K for the year ended December 31, 2019, in First Citizens’ and CIT’s respective Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020, and September 30, 2020, and in other documents incorporated by reference into this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information” beginning on page 183 of this joint proxy statement/prospectus for the location of information incorporated by reference into this joint proxy statement/prospectus.
CIT Litigation Update
On October 21, 2016, CIT and CIT Bank were named as defendants in an existing lawsuit brought as a qui tam (i.e., whistleblower) action by a former OneWest employee on behalf of the U.S. government. The lawsuit asserted claims related to OneWest’s participation in the Home Affordable Modification Program (“HAMP”) administered by the United States Treasury Department, as well as Federal Housing Administration (“FHA”) and Veterans Administration (“VA”) insurance programs. On October 15, 2019, the plaintiff filed a second amended complaint in the United States District Court for the Eastern District of Texas alleging that, beginning in 2009, CIT (and its predecessor, OneWest) falsely certified its compliance with HAMP, submitted false claims for incentive payments for loan modifications, submitted false claims for FHA insurance payments and failed to self-report these violations. Plaintiff seeks the return of all U.S. government payments to CIT under the HAMP, FHA or VA programs. CIT has received approximately $93 million in servicer incentives under HAMP, and the government has paid more than $400 million in the aggregate in borrower, servicer and investor incentives in connection with loans modified by OneWest or CIT under HAMP. The Department of Justice has declined to intervene in this case. On May 5, 2020, a federal court judge in the Eastern District of Texas denied CIT’s motion to dismiss the second amended complaint, and the case is now in discovery. There is currently no scheduled trial date. CIT is defending this litigation vigorously and believes that it has meritorious defenses.
The foregoing description is subject to, and should be read together with the descriptions of the risks and uncertainties of litigation in the sections entitled “Risk Factors” and the notes entitled “Litigations and other Contingencies” in CIT’s Annual Report on Form 10-K for the year ended December 31, 2019, and in CIT’s Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2020, June 30, 2020 and September 30, 2020.
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Litigation Relating to the Mergers
Beginning November 20, 2020, six purported holders of CIT common stock filed substantially similar complaints against CIT and the members of the CIT board of directors in the United States District Courts for the Southern District of New York (Stein v. CIT Group Inc., et al, No. 1:20-cv-09810 (S.D.N.Y. filed November 20, 2020); Velasquez v. CIT Group Inc., et al, No. 1:20-cv-10266 (S.D.N.Y. filed December 4, 2020); and Uguagliati v. CIT Group Inc., et al, No. 1:20-cv-10271 (S.D.N.Y. filed December 5, 2020)); the District of Delaware (Thomas v. CIT Group Inc., et al, No. 1:20-cv-01641 (D. Del. filed December 2, 2020)); and the District of New Jersey (Rhoda v. CIT Group Inc., et al, No. 2:20-cv-17547 (D.N.J. filed December 1, 2020); Konder v. CIT Group Inc., et al, No. 2:20-cv-18449 (D.N.J. filed December 8, 2020)). One of the suits (Thomas) also names as defendants First Citizens, First Citizens Bank, and Merger Sub. The complaints all assert claims under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder against CIT and the members of the CIT board of directors, and claims under Section 20(a) of the Exchange Act against the members of the CIT board of directors (and in the Thomas case First Citizens, First Citizens Bank, and Merger Sub) for allegedly causing a materially incomplete and misleading registration statement on Form S-4 to be filed on November 16, 2020 with the SEC. Among other remedies, the plaintiffs seek to enjoin the mergers.
The outcome of the pending and any additional future litigation is uncertain. If any case is not resolved, the lawsuit(s) could prevent or delay completion of the mergers and result in substantial costs to First Citizens and CIT, including any costs associated with the indemnification of directors and officers. Other potential plaintiffs may file additional lawsuits against First Citizens, CIT and/or the directors and officers of either company in connection with the mergers. The defense or settlement of any lawsuit or claim that remains unresolved at the time of the completion of the mergers may adversely affect the combined company’s business, financial condition, results of operations and cash flows.
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SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF FIRST CITIZENS
The following selected consolidated financial information of First Citizens as of and for the nine months ended September 30, 2020 and September 30, 2019, has been derived from First Citizens’ unaudited consolidated financial statements as of and for the nine months ended September 30, 2020 and September 30, 2019, respectively, incorporated by reference in this joint proxy statement/prospectus. The following selected consolidated financial information of First Citizens as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017, has been derived from First Citizens’ audited consolidated financial statements incorporated by reference in this joint proxy statement/prospectus, and the selected consolidated financial information as of December 31, 2017, 2016 and 2015 and for the years ended December 31, 2016 and 2015, has been derived from First Citizens’ audited consolidated financial statements not appearing or incorporated by reference in this joint proxy statement/prospectus.
You should read the following financial information relating to First Citizens in conjunction with other information contained in this joint proxy statement/prospectus, including consolidated financial statements of First Citizens and related accompanying notes appearing in First Citizens’ Annual Report on Form 10-K most recently filed with the SEC and in any Quarterly Reports on Form 10-Q of First Citizens filed with the SEC after that Annual Report on Form 10-K was filed, and the financial statements in any Current Report on Form 8-K of First Citizens that was filed with the SEC after such Annual Report on Form 10-K, each of which reports is incorporated by reference in this joint proxy statement/prospectus. First Citizens’ historical results for any prior period are not necessarily indicative of results to be expected in any future period. First Citizens has consummated several acquisitions in recent fiscal periods. The results and other financial information of those acquired operations are not included in the table below for the periods or dates prior to their respective acquisition dates and, therefore, the results for these prior periods are not comparable in all respects and may not be predictive of First Citizens’ future results. In addition, the selected financial information in the table immediately below does not include, on any basis, the results or financial condition of CIT for any period or as of any date. For more information, see the section entitled “Where You Can Find More Information” beginning on page 183.
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Selected Consolidated Historical Financial Data of First Citizens
 
As of and for the Nine Months
Ended September 30,
(unaudited)
As of and for the Year Ended December 31,
(Dollars in millions, except share data)
2020
2019
2019
2018
2017
2016
2015
SUMMARY OF OPERATIONS
 
 
 
 
 
 
 
Interest income
$1,107.2
$1,050.0
$1,404.0
$1,245.8
$1,103.7
$987.8
$969.2
Interest expense
77.7
65.7
92.6
36.9
43.8
43.1
44.3
Net interest income
1,029.5
984.2
1,311.4
1,208.9
1,059.9
944.7
924.9
Provision for credit losses(1)
52.9
23.7
31.4
28.5
25.7
32.9
20.7
Net interest income after provision for credit losses
976.5
960.5
1,279.9
1,180.4
1,034.2
911.7
904.2
Gain on acquisitions
134.7
5.8
42.9
Noninterest income excluding gain on acquisitions
350.0
311.5
415.9
400.1
387.2
371.3
424.2
Noninterest expense
883.3
811.5
1,103.7
1,077.0
1,012.5
937.8
1,038.9
Income before income taxes
443.2
460.5
592.0
503.6
543.7
351.1
332.4
Income taxes
89.5
105.0
134.7
103.3
219.9
125.6
122.0
Net income
353.6
355.5
457.4
400.3
323.8
225.5
210.4
Net income available to common shareholders
$344.2
$355.5
$457.4
$400.3
$323.8
$225.5
$210.4
PER COMMON SHARE DATA
 
 
 
 
 
 
 
Net income
$33.96
$31.50
$41.05
$33.53
$26.96
$18.77
$17.52
Cash dividends
1.20
1.20
1.60
1.45
1.25
1.20
1.20
Book value at period end
380.43
327.86
337.38
300.04
277.60
250.82
239.14
SELECTED PERIOD-END BALANCES
 
 
 
 
 
 
 
Total assets
$48,666.9
$37,748.3
$39,824.5
$35,408.6
$34,527.5
$32,990.8
$31,475.9
Investment securities
9,860.6
7,167.7
7,173.0
6,834.4
7,180.3
7,006.7
6,861.5
Loans and leases
32,845.1
27,196.5
28,881.5
25,523.3
23,596.8
21,737.9
20,240.0
Allowance for credit losses(1)
223.9
226.8
225.1
223.7
221.9
218.8
206.2
Deposits
42,250.6
32,743.3
34,431.2
30,672.5
29,266.3
28,161.3
26,930.8
Borrowings
1,945.9
976.1
1,326.9
892.2
1,564.1
1,436.4
1,299.0
Common shareholders’ equity
$3,734.5
$3,568.5
$3,586.2
$3,489.0
$3,334.1
$3,012.4
$2,872.1
Shareholders’ equity
$4,074.4
$3,568.5
$3,586.2
$3,489.0
$3,334.1
$3,012.4
$2,872.1
Shares outstanding
9.8
10.9
10.6
11.6
12.0
12.0
12.0
SELECTED RATIOS AND OTHER DATA
 
 
 
 
 
 
 
Rate of return on average assets
1.05%
1.29%
1.23%
1.15%
0.94%
0.70%
0.68%
Rate of return on average shareholders’ equity
12.59
13.41
12.88
11.69
10.10
7.51
7.52
Average equity to average assets ratio
8.69
9.64
9.56
9.81
9.35
9.25
9.00
Net yield on interest-earning assets (taxable equivalent)
3.23
3.80
3.74
3.69
3.30
3.14
3.22
Net charge-offs (annualized) to average loans and leases
0.07
0.10
0.11
0.11
0.10
0.10
0.10
Allowance for credit losses to total loans and leases(2):
 
 
 
 
 
 
 
PCD
5.07
1.34
1.35
1.51
1.31
1.70
1.72
Non-PCD
0.61
0.82
0.77
0.86
0.93
0.98
0.98
Total
0.68
0.83
0.78
0.88
0.94
1.01
1.02
Ratio of total nonperforming assets to total loans, leases and other real estate owned
0.73
0.57
0.58
0.52
0.61
0.67
0.83
Tier 1 risk-based capital ratio
11.48
11.80
10.86
12.67
12.88
12.42
12.65
Common equity Tier 1 ratio
10.43
11.80
10.86
12.67
12.88
12.42
12.51
Total risk-based capital ratio
13.70
13.09
12.12
13.99
14.21
13.85
14.03
Leverage capital ratio
7.80
9.18
8.81
9.77
9.47
9.05
8.96
(1)
First Citizens adopted ASC Topic 326 (“CECL”) utilizing the modified retrospective approach. First Citizens did not restate selected financial data for the periods prior to 2020 presented above.
(2)
Upon adoption of CECL as of January 1, 2020, the concept of purchased credit impaired loans under ASC 310-30 was eliminated. Loans and leases determined at the date of acquisition, to have experienced more than insignificant credit quality since origination are accounted for under the guidance in ASC Topic 326-20, Credit Losses as purchased credit deteriorated assets. PCD loans and leases are recorded at fair value at the date of acquisition with an initial reserve recorded directly to the allowance for credit losses. Provision is recorded if there is additional credit deterioration after the acquisition date. Non-PCD loans include originated and purchased non-credit deteriorated loans. Loans previously classified as PCI were determined to be PCD.
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SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF CIT
The following selected consolidated financial information of CIT as of and for the nine months ended September 30, 2020 and September 30, 2019 has been derived from CIT’s unaudited consolidated financial statements as of and for the nine months ended September 30, 2020 and September 30, 2019, respectively, incorporated by reference in this joint proxy statement/prospectus. The following selected consolidated financial information of CIT as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017 has been derived from CIT’s audited consolidated financial statements incorporated by reference in this joint proxy statement/prospectus. The selected consolidated financial information of CIT as of December 31, 2017, 2016 and 2015 and for the years ended December 31, 2016 and 2015 has been derived from CIT’s consolidated financial statements not incorporated by reference in this joint proxy statement/prospectus.
You should read the following financial information relating to CIT in conjunction with other information contained in this joint proxy statement/prospectus, including consolidated financial statements of CIT and related accompanying notes appearing in CIT’s Annual Report on Form 10-K most recently filed with the SEC and in any Quarterly Reports on Form 10-Q of CIT filed with the SEC after that Annual Report on Form 10-K was filed, and the financial statements in any Current Report on Form 8-K of CIT that was filed with the SEC after such Annual Report on Form 10-K, each of which reports is incorporated by reference in this joint proxy statement/prospectus. CIT’s historical results for any prior period are not necessarily indicative of results to be expected in any future period. On January 1, 2020, CIT acquired Mutual of Omaha Bank (“MOB”). The results for 2020 include the activity of MOB where no MOB activity is included in the results for years prior. CIT also adopted ASC Topic 326 (“CECL”) utilizing the modified-retrospective approach; therefore, prior period financial information was not adjusted and is reported under previously applicable accounting guidance. As such, the results for these prior periods are not comparable in all respects and many not be predictive of CIT’s future results. In addition, the selected financial information in the table immediately below does not include, on any basis, the results or financial condition of First Citizens for any period or as of any date. For more information, see the section entitled “Where You Can Find More Information” beginning on page 183.
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Selected Consolidated Historical Financial Data of CIT
 
Nine Months Ended
September 30,
(unaudited)
At or for the Years Ended December 31,
 
2020
2019
2019
2018
2017
2016
2015
Select Statement of Operations Data
 
 
 
 
 
 
 
Net interest revenue
$790.1
$813.2
$1,064.8
$1,075.3
$1,117.9
$1,158.3
$713.8
Provision for credit losses
800.8
88.2
110.8
171.0
114.6
194.7
158.6
Total non-interest income
991.2
946.3
1,272.9
1,382.8
1,371.6
1,182.2
1,167.7
Total non-interest expenses
1,720.4
1,227.3
1,603.0
1,650.1
2,183.3
2,124.9
1,536.9
(Loss) income from continuing operations, net of tax
(623.9)
398.8
529.4
472.1
259.4
(182.6)
724.1
Net (loss) income
(623.9)
399.3
529.9
447.1
468.2
(848.0)
1,034.1
Net (loss) income available to common shareholders
(642.8)
389.9
511.0
428.2
458.4
(848.0)
1,034.1
Per Common Share Data
 
 
 
 
 
 
 
Diluted (loss) income per common share - continuing operations
$(6.54)
$3.99
$5.27
$3.82
$1.52
$(0.90)
$3.89
Diluted (loss) income per common share
(6.54)
4.00
5.27
3.61
2.80
(4.20)
5.55
Book value per common share
53.17
60.27
61.37
55.70
53.25
49.50
54.45
Dividends declared per common share
1.05
1.05
1.30
0.82
0.61
0.60
0.60
Dividend payout ratio
NM
26.3%
24.7%
22.7%
21.8%
NM
10.8%
Performance Ratios
 
 
 
 
 
 
 
Return (available to common shareholders; continuing operations) on average common stockholders' equity(1)
NM
9.25%
9.03%
7.30%
3.53%
NM
11.96%
Average total equity to average total asset ratio
10.2%
12.1%
12.2%
13.8%
16.1%
17.0%
17.9%
Balance Sheet Data
 
 
 
 
 
 
 
Loans including receivables pledged
$37,319.6
$31,345.5
$30,998.9
$30,795.4
$29,113.9
$29,535.9
$30,518.7
Allowance for credit losses
(1,206.2)
(486.2)
(482.6)
(489.7)
(431.1)
(432.6)
(347.0)
Operating lease equipment, net
7,799.3
7,099.9
7,319.7
6,970.6
6,738.9
7,486.1
6,851.7
Total cash and deposits
6,705.6
1,824.6
2,685.6
1,795.6
1,718.7
6,430.6
7,652.4
Investment securities
6,608.8
6,109.7
6,276.8
6,233.8
6,469.9
4,491.1
2,953.7
Total assets
60,865.0
51,403.1
50,832.8
48,537.4
49,278.7
64,170.2
67,391.9
Deposits
44,706.2
35,910.0
35,139.5
31,239.5
29,569.3
32,304.3
32,761.4
Borrowings
7,284.7
6,423.2
6,473.4
8,118.8
8,974.4
14,935.5
16,350.3
Total common stockholders’ equity
5,239.0
5,708.5
5,814.0
5,621.6
6,995.0
10,002.7
10,944.7
Credit Quality
 
 
 
 
 
 
 
Non-accrual loans as a percentage of loans
1.73%
0.95%
1.05%
0.92%
0.76%
0.94%
0.83%
Net charge-offs as a percentage of average loans
1.02%
0.39%
0.39%
0.39%
0.39%
0.37%
0.58%
Allowance for loan losses as a percentage of loans
3.23%
1.55%
1.56%
1.59%
1.48%
1.46%
1.14%
Capital Ratios
 
 
 
 
 
 
 
CET1 capital ratio (fully phased-in)
9.9%
11.6%
12.0%
12.0%
14.4%
13.8%
12.6%
Tier 1 capital ratio (fully phased-in)
10.9%
12.3%
13.2%
12.7%
15.1%
13.8%
12.6%
Total capital ratio (fully phased-in)
13.1%
14.3%
15.4%
14.8%
16.2%
14.6%
13.2%
(1)
2017 and prior periods are adjusted to reflect an estimated reduction in equity for Commercial Air, that was transferred to discontinued operations and sold.
NM – Not meaningful
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UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL INFORMATION
The following unaudited pro forma condensed combined financial information of First Citizens and CIT is presented to illustrate the estimated effect of the mergers. Specifically, the unaudited pro forma condensed combined balance sheet as of September 30, 2020 combines the historical consolidated balance sheets of First Citizens and CIT as of such date and include adjustments that depict the accounting for the Merger required by GAAP (“pro forma balance sheet transaction accounting adjustments”) as of December 18, 2020. Also, the unaudited pro forma condensed combined statements of income for the year ended December 31, 2019 and the nine months ended September 30, 2020 combine the historical consolidated statements of income of First Citizens and CIT for the same periods and include adjustments that depict the effects of the pro forma balance sheet transaction accounting adjustments assuming those adjustments were made as of January 1, 2019 (“pro forma income statement transaction accounting adjustments”). We refer to the unaudited pro forma condensed combined balance sheets and the unaudited pro forma condensed combined statements of income collectively as “Pro Forma Financial Information.” Also, we refer to pro forma balance sheet transaction accounting adjustments and pro forma statements of income transaction accounting adjustments collectively as “Transaction Accounting Adjustments.”
First Citizens and CIT each prepare their respective financial statements in accordance with GAAP. The mergers will be accounted for using the acquisition method of accounting, and First Citizens will be treated as the accounting acquirer. In a business combination effected primarily by transferring cash or stock, the entity that transfers the cash or stock is generally the acquirer. In identifying First Citizens as the acquiring entity for accounting purposes, First Citizens and CIT considered a number of factors, including the legal acquirer, the entity issuing stock, the surviving entity, the relative voting rights of all equity instruments in the combined company, the intended corporate governance structure of the combined company and the terms of the exchange of equity securities pursuant to the merger agreement. No single factor was the sole determinant in the overall conclusion that First Citizens is the acquirer for accounting purposes; rather, all factors were considered in arriving at such conclusion.
First Citizens has not had sufficient time to completely evaluate the significant identifiable long-lived tangible and identifiable intangible assets of CIT. Accordingly, the unaudited pro forma adjustments, including the allocations of the purchase price, are preliminary and have been made solely for the purpose of providing unaudited pro forma condensed combined financial information with materially relevant estimated adjustments. Certain reclassifications have been made to the historical financial statements of CIT to conform to the presentation in First Citizens’ financial statements. Accordingly, the unaudited pro forma condensed combined financial information is presented for illustrative purposes only and is not necessarily indicative of the results that might have occurred had the mergers taken place on January 1, 2019, for statements of income purposes and on September 30, 2020, for financial condition purposes, and is not intended to be a projection of future results. Historical results for any prior period are not necessarily indicative of results to be expected in any future period, and historical results for the nine months ended September 30, 2020, are not necessarily indicative of results to be expected for all of 2020. A final determination of the acquisition consideration and fair values of CIT’s assets and liabilities, which cannot be made prior to the completion of the mergers, will be based on the actual net tangible and intangible assets of CIT that exist as of the date of completion of the mergers. Consequently, preliminarily values allocated to assets and liabilities of CIT, including the identifiable intangibles and the related bargain purchase gain could change significantly from those allocations used in the unaudited pro forma condensed combined financial information presented below and those differences could be material including in amortization of acquired intangible assets.
In addition, future results may differ materially from the results reflected because of various factors, including those discussed in the section entitled “Risk Factors” beginning on page 43 and appearing under the caption “Risk Factors” in First Citizens’ and CIT’s most recently filed Annual Reports on Form 10-K and in any subsequently filed Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, which are incorporated by reference in this joint proxy statement/prospectus, and the factors discussed in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 41. Among other factors, the actual amounts recorded as of the completion of the mergers may differ materially from the information presented in these unaudited pro forma condensed combined financial statements as a result of:
changes in the trading price for First Citizens’ Class A common stock;
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net cash used or generated in First Citizens’ or CIT’s operations between the signing of the merger agreement and the completion of the mergers;
the timing of the completion of the mergers, changes in total merger-related expenses, and integration costs, including costs associated with systems implementation, severance, and other costs related to exit or disposal activities;
other changes in First Citizens’ or CIT’s net assets that occur prior to the completion of the mergers, which could cause material differences in the information presented below; and
changes in the financial results of the combined company.
The unaudited pro forma condensed combined financial information is provided for illustrative information purposes only. The unaudited pro forma condensed combined financial information is not necessarily, and should not be assumed to be, an indication of the actual results that would have been achieved had the mergers been completed as of the dates indicated or that may be achieved in the future. The pro forma financial information has been prepared by First Citizens in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures About Acquired and Disposed Businesses, as adopted by the SEC on May 21, 2020 (“Article 11”). First Citizens has elected to voluntarily comply with the amended Article 11 in advance of the mandatory compliance date.
The unaudited pro forma condensed combined financial statements should be read together with:
the accompanying notes to the unaudited pro forma condensed combined financial statements;
First Citizens’ separate audited historical consolidated financial statements and accompanying notes as of and for the year ended December 31, 2019, included in First Citizens’ Annual Report on Form 10-K for the year ended December 31, 2019;
CIT’s separate audited historical consolidated financial statements and accompanying notes as of and for the year ended December 31, 2019, included in CIT’s Annual Report on Form 10-K for the year ended December 31, 2019;
First Citizens’ separate unaudited historical consolidated financial statements and accompanying notes as of and for the nine months ended September 30, 2020, included in First Citizens’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2020;
CIT’s separate unaudited historical consolidated financial statements and accompanying notes as of and for the nine months ended September 30, 2020, included in CIT’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020; and
other information pertaining to First Citizens and CIT contained in or incorporated by reference into this joint proxy statement/prospectus. See the sections entitled “—Selected Consolidated Historical Financial Data of First Citizens” and “—Selected Consolidated Historical Financial Data of CIT” included elsewhere in this joint proxy statement/prospectus.
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Pro Forma Condensed Combined Balance Sheets
As of September 30, 2020
(Unaudited)
(Dollars in millions, except per share data)
First
Citizens
as
Reported
CIT
as
Reported
Transaction
Accounting
Adjustments
(Note 3)
Pro Forma
First
Citizens &
CIT
Assets
 
 
 
 
 
Cash and due from banks
$352.4
$175.7
$
 
$528.1
Overnight investments
3,137.9
6,529.9
 
9,667.8
Investment securities
9,860.6
6,608.8
 
16,469.4
Assets held for sale
120.3
56.7
 
177.0
Loans and leases
32,845.1
37,319.6
34.1
(1)
70,198.8
Allowance for credit losses
(223.9)
(1,206.2)
 
(1,430.1)
Net loans and leases
32,621.2
36,113.4
34.1
 
68,768.7
Operating lease equipment, net
7,799.3
 
7,799.3
Premises and equipment
1,255.3
191.6
 
1,446.9
Goodwill
350.3
140.4
(140.4)
(2)
350.3
Other intangible assets
54.2
143.4
(59.1)
(3)
138.5
Income earned not collected and other assets
914.7
3,105.8
 
4,020.5
Total assets
$48,666.9
$60,865.0
$(165.4)
 
$109,366.5
Liabilities
 
 
 
 
 
Deposits:
 
 
 
 
 
Noninterest-bearing
$18,234.6
$3,022.1
$
 
$21,256.7
Interest-bearing
24,016.0
41,684.1
161.9
(4)
65,862.0
Total deposits
42,250.6
44,706.2
161.9
 
87,118.7
Credit balances of factoring clients
1,320.2
 
1,320.2
Borrowings
1,946.0
7,284.7
215.3
(5)
9,446.0
Deferred tax liability
32.7
78.6
33.5
(6)
144.8
Other liabilities
363.2
1,711.3
17.0
(7)
2,091.5
Total liabilities
44,592.5
55,101.0
427.7
 
100,121.2
Shareholders’ equity
 
 
 
 
 
Common stock:
 
 
 
 
 
Class A
8.8
1.6
4.6
(8)
15.0
Class B
1.0
 
1.0
Preferred stock
339.9
525.0
 
864.9
Surplus
6,882.1
(3,289.6)
(9)
3,592.5
Retained earnings
3,738.4
1,467.1
(419.9)
(10)
4,785.6
Accumulated other comprehensive loss
(13.7)
46.4
(46.4)
(11)
(13.7)
Treasury stock
(3,158.2)
3,158.2
(12)
Total shareholders’ equity
4,074.4
5,764.0
(593.1)
 
9,245.3
Total liabilities and shareholders’ equity
$48,666.9
$60,865.0
$(165.4)
 
$109,366.5
Book value per share(a)
$380.43
$53.17
 
 
$524.63
(a)
The pro forma book value per share amounts were calculated by totaling the historic stockholders’ equity (excluding preferred stock) of First Citizens and CIT, adjusted for purchase accounting entries, and dividing the resulting amount by the pro forma shares of First Citizens and CIT, giving effect to the merger as if it had occurred as of the beginning of the period presented. The pro forma shares of First Citizens and CIT reflect historical shares, plus historical shares of CIT, as adjusted based on the fixed exchange ratio of 0.062 shares of First Citizens Class A common stock for each share of CIT common stock. The number of shares to be issued is subject to adjustment in certain limited circumstances. See Note 2 for pro forma share information.
See accompanying notes to unaudited pro forma condensed combined financial statements.
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Pro Forma Condensed Combined Statements of Income
For The Nine Month Period Ended September 30, 2020
(Unaudited)
(Dollars in millions, except share and per share data)
First
Citizens
as
Reported
CIT
as
Reported
Transaction
Accounting
Adjustments