Stifel's David Bishop Joins Smaller Rival

Some of the busiest M&A activity is likely to be in the Southeast and Southwest, so MLV decided to acquire an expert.

The New York investment bank has hired David Bishop as a senior analyst to help launch a research unit that initially will cover banks with less than $5 billion of assets in the two southern regions. Bishop has spent the last seven years covering banks there as an analyst for Stifel Nicolaus.

Though conditions have improved in the Southeast and Southwest, some banks are still struggling with legacy credit issues and orders to raise more capital.

"There are still a lot of community banks that need an exit," Bishop says. "There are opportunities, and you will see some acceleration for deals there compared with some other regions."

Some stronger players "are out on the offensive" and could benefit from acquiring "the walking wounded," Bishop says. Because of this, picking up coverage of "buyers that have been active before can add value to the research side," he says.

Stable stock prices and the lure of potential cost savings are bringing buyers and sellers to the negotiating table, Bishop says. There have also been some deals with healthy pricing that is giving the market hope.

Prosperity Bancshares (PB) in Houston recently purchased Coppermark Bancshares in Oklahoma City in a deal priced at 1.6% of tangible book value. Renasant (RNST) in Tupelo, Miss., agreed to buy First M&F in Kosciusko, Miss., for a 119% premium over tangible book value.

"In three to five years, the coverage universe might look different," Bishop says. "It's an opportune time to pick up coverage."