Jackie Stewart is the executive editor of American Banker Magazine. Previously, she covered breaking news, community banks and mergers and acquisitions for American Banker before being named as the managing editor of the Credit Union Journal. After graduating from Northwestern University in 2006, Jackie taught for two years in the Bronx, N.Y., through Teach for America.
Capital Bank CEO Eugene Taylor took a three-year break from acquisitions until agreeing to buy CommunityOne earlier this year. Taylor hopes the deal provides evidence that his team is a buyer not a seller in the year ahead.
BofI Holding's CEO Greg Garrabrants should be basking in the glow of his bank's record earnings growth and its potentially transformative acquisition of H&R Block Bank. Instead, he's fighting to regain the confidence of shareholders spooked by allegations that the online bank violated anti-money-laundering laws.
Strong financials were an important consideration behind the $1 billion merger, but it often takes more than good numbers to compel Korean-American banks to merge. Hanmi Financial found that out the hard way after its unsolicited bid for BBCN largely fell on deaf ears.
Some of BBCN's directors actually favored a deal with Hanmi to cement its position as the nation's biggest Korean-American bank. That disclosure could spur Hanmi to make a direct appeal to BBCN's shareholders in coming months.
Banks face a growing risk of complacency given years of improved credit quality. They should periodically evaluate the status of loans and underlying collateral to make sure they proactively manage risk.
The once-prolific acquirer had been on the sidelines for more than three years while under the ownership of National Australia Bank. But it said when it was spun off from NAB that it was mulling acquisitions and on Monday it announced a deal to buy rival HF Financial for $139.5 million.
Hanmi wants to make sure that, when the dust settles, it is part of the nation's biggest Korean-American bank. The move also shows how difficult it will be for ethnic banks to gain meaningful scale while sticking to their niche groups.
American Chartered was also the top M&A priority for MB Financial, which was willing to pay a healthy premium to get a deal done. MB Financial, which prefers big acquisitions, will be challenged to find other opportunities in the Windy City.
More banks are looking to buy commercial loans for reasons ranging from a dearth of organic opportunities to a need to diversify their asset mix. That surge in demand is creating an imbalance that benefits banks that have been able to make more loans.
KeyCorp and New York Community Bancorp are among a number of buyers pledging to aggressively cut costs at acquired banks. There are plenty of ways to go about it, but acquirers risk cutting too deeply in the effort to appease wary investors.