Bank M&A's Melting Pot
January 28, 2014 3:06 PM
Banks and other companies headquartered abroad have been busy buying and selling financial firms in the United States recently. Here's a look at M&A activity lately that's had a distinctly international flavor.
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Happy to Solve Your Problem
Royal Bank of Scotland was looking to divest from its American operations to repay its U.K. bailout. U.S. Bancorp (USB) CEO Richard Davis willingly obliged by agreeing to buy its Chicago branches for $315 million.
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What's Your Next Move?
Citizens Financial Group, RBS's U.S. unit, will hold a partial public offering this year and be fully independent by 2016, says Bruce Van Saun, the head of the U.S. unit. Even so, speculation persists that other banks will bid to take over Citizens.
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Neighbor to the North
Toronto-Dominion Bank, with a large U.S. presence, is often discussed as a likely suitor for Citizens or other big Yankee targets. It bought The South Financial Group in 2010 and Chrysler Financial in 2011 but hasn't acquired a big U.S. lender since.
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China Beachhead
MetroCorp Bancshares (MCBI) in Houston, led by George Lee, said in December that it shopped itself to Chinese financial institutions "interested in entering the U.S. market." It then decided to sell to East West Bancorp (EWBC), a Los Angeles company that largely caters to Chinese-Americans. U.S. regulators in 2012 approved the first investment in a U.S. bank by a Chinese counterpart. More such investments are expected.
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Florida Fishing Trip
The third largest bank deal of 2013 involved the Chilean Banco de Credito e Inversiones' agreement to buy the parent company of City National Bank of Florida for $881 million from Spain's troubled Bankia. Banco de Credito has a successful branch in Miami but plans to keep City National, led by Jorge Gonzalez, autonomous.
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We'll Visit Again
Miami was the stage for other bank deals, including Banco Sabadell's agreement to buy JGB Bank for $56 million. More M&A is expected in South Florida, in part because of foreign buyers' interest in its international clientele.
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Recasting Its Image
Marketing is always a big challenge for foreign banks doing business in the U.S. Spain's Santander Group (SAN) bought Sovereign Bank in 2009 and rebranded it as Santander Bank last year with a campaign that included a humorous TV ad starring Robert De Niro.
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Busy BBVA
BBVA Compass, the Birmingham. Ala.-based unit of Spain's Banco Bilbao Vizcaya Argentaria (BBVA), has grown by acquisition and been trying to raise its profile. It has applied to be a registrant with the Securities and Exchange Commission and sponsors the BBVA Compass Bowl; it also announced this month plans to lay off up to 600 workers.
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Toe in the Water?
Portugal's fourth-largest bank, Banco Português de Investimento, has received approval to open U.S. representative offices in Newark, N.J., and New Bedford, Mass.
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Cross-Border Match
Davis + Henderson's acquisition in August of Harland Financial Solutions is expected to make the Toronto company a significant player in U.S. financial services technology-provided the integration goes smoothly. D+H has more than 6,000 financial institution customers in the U.S. and Canada.
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