Buyers, sellers and shareholders rarely profit from bank acquisitions, the author argues. There are too many things that have to go right in the pricing and integration, and there is too much that can go wrong.
Consolidation is needed to help the economy because there are too many banks, argues the author, a longtime bank investor. Many parties benefit from deals, and any return for the seller is better than producing poor results or being seized by regulators.
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.
When it agreed to be sold to Stifel last year, KBW was painted as a victim of weak bank M&A and the transformation of investment banking. Things are looking up now as the combined company ranked as the top advisor in four of six U.S. regions at midyear.