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M&A's Deposit Chasers

Most bank buyers are looking for loan growth, but a rare few want to add deposits. The following banks have either struck deals for, or are likely buyers of, highly liquid targets.

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Sterling Financial (STSA) Sterling Financial (STSA) $9.9 billion in assets
Spokane, Wash.

Sterling agreed this spring to buy Commerce National Bank in Costa Mesa, Calif. The deal aims to complement Sterling's Southern California lending team that is focused on multifamily loans with a full-service banking office. Look for it to do similar deals in greater Los Angeles.

Related Article: Sterling Detects Value in Small Deals Others Miss

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Pacific Premier Bancorp (PPBI) Pacific Premier Bancorp (PPBI) $1.55 billion in assets
Irvine, Calif.

Steven Gardner, Pacific Premier's chief executive, was on the hunt for liquidity last year because its growing warehouse lending business pushed its loan-to-deposit ratio to nearly 100%. Two bank acquisitions lowered its ratio to 80.6%.

Related Articles: Strong Loan Growth Makes Pacific Premier a Buyer

Pacific Premier to Buy San Diego Trust

PrivateBancorp (PVTB) PrivateBancorp (PVTB) $13.5 billion in assets
Chicago

The company regularly reports impressive commercial and industrial loan growth, but analysts say its deposit-gathering ability is lacking. It is viewed as buyer or even a seller. CEO Larry Richman describes its M&A appetite as "opportunistic."

Related Article: Chicago Bankers Weigh In on MB-Taylor Deal's Impact

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Southern Missouri Bancorp (SMBC) Southern Missouri Bancorp (SMBC) $796 million in assets
Poplar Bluff, Mo.

Its loans rose 11% at June 30 from a year earlier, and its bank's loan-to-deposit ratio was nearing 100%. In June, Southern announced a deal to buy a bank with a ratio of roughly 55%. CFO Matt Funke says it is on the hunt for other deals.

Related Articles: Missouri Deal Sheds Light on Hidden Value in Tiny Banks

Bank Sellers Gain Edge as Buyers Get Antsy

PacWest Bancorp (PACW) PacWest Bancorp (PACW) $6.7 billion in assets
Los Angeles

PacWest's recent announcement that it would acquire specialty lender CapitalSource was clearly a move to improve loan growth, but CEO Matt Wagner said future deals could include deposit-heavy banks that would be used to fuel CapitalSource's lending.

Related Article: Banks Need to Break M&A Mold: Lesson of the PacWest Deal

Pinnacle Financial Partners (PNFP) Pinnacle Financial Partners (PNFP) $5.4 billion in assets
Nashville, Tenn.

Improving its funding is a priority for Pinnacle. It could use its strong stock to achieve its goals through M&A, analysts say. CEO Terry Turner says the company is interested in deals in Nashville or Knoxville, but the list of candidates is short.

Related Articles: Fees, Loans Lift Pinnacle in Tenn.

These Small Lenders Will Be Loan Champs - But Will That Be Enough?

Independent Bank Group (IBTX) Independent Bank Group (IBTX) $1.8 billion in assets
McKinney, Texas

CEO David Brooks said in May that the acquisitive bank was "paying close attention" to the deposit makeup of its targets. In July, it announced it would acquire Collin Bank in Plano, Texas. The target's loan-to-deposit ratio is 53%, compared with Independent's 99.3%.

Related Articles: Fresh Off IPO, Independent in Texas Hunts for Deals

Independent Bank to Buy Collin Bank in Texas

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Banks In and Around New York City Banks In and Around New York City New York Community Bancorp (NYCB) is known to buy deposit-rich banks to fund its multifamily-lending operation. ConnectOne Bancorp (CNOB) is on the hunt for deals after recently going public, and it could aim to lower its loan-to-deposit ratio.

The New York City region is home to several thrifts that could turn to dealmaking to improve funding before interest rates go up.

Related Articles: New York Community, OneWest Would Make Smart Bedfellows

ConnectOne Gives Signs That Point to Big Apple

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Most bank buyers are looking for loan growth, but a rare few want to add deposits. The following banks have either struck deals for, or are likely buyers of, highly liquid targets.

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