Author, lecturer, and lawyer Robert L. Tortoriello often wishes there were more hours in the day, but he always has time to talk about cross- border mergers.
Mr. Tortoriello, who heads up the U.S. financial institutions group in the New York office of the international law firm Cleary, Gottlieb, Steen & Hamilton, sees a clear-cut opportunity for his firm in the flurry of bank mergers overseas.
The veteran merger and acquisition attorney says cross-border deals among financial institutions will be at the forefront of the next wave of merger activity.
Major deals between U.S. banks and foreign financial institutions could come as early as the second half of the year, he said. "The world is getting smaller, and the financial services are getting more globalized. It sounds trite, but it's true."
Cleary Gottlieb, an international partnership, has offices in eight cities and more than 500 lawyers.
Though Mr. Tortoriello has counterparts around the world, he makes sure he is abreast of every bank merger deal abroad.
One of the biggest cross-border bank deals that the firm has worked on is Deutsche Bank's $10.1 billion planned acquisition of Bankers Trust Corp. The firm represented Deutsche.
Merger activity is clearly on the rise on Europe.
In the first quarter Banque National de Paris launched a $37.7 billion hostile bid for Societe Generale SA and Paribas SA.
If the deal goes through it would create the first bank with assets exceeding a trillion dollars.
And Banco de Santander, Spain's largest, proposed an $11.3 billion acquisition of Banco Central Hispanoamericano.
"It's just a matter of time before those large conglomerates start looking at United States institutions," Mr. Tortoriello said.
He said his firm is positioned to pick up a considerable portion of these international deals.
Cleary Gottlieb was the No. 2 legal adviser on U.S. bank mergers for the first three months of 1999, according to statistics compiled by American Banker and Sheshunoff Information Services, a Thomson Financial company.
In the first quarter of 1998 it was ranked 10th.
Cleary Gottlieb was also ranked No. 1 in northeastern bank merger deals in the first quarter, according to the same survey.
Cross-border bank mergers have already had a tremendous impact on the United States.
Foreign banks have $1.34 trillion of assets in the United States, representing 26.1% of total U.S. banking assets, according to a 1997 survey by the Institute of International Bankers.
According to the same survey, 355 foreign banks maintained 499 U.S. branches and agency offices, 100 U.S. bank subsidiaries, 16 other U.S. banking affiliates, and 255 U.S. representative offices.
More than 180 U.S. banks had over 790 branches outside the United States.
Big banks that already have a presence in the United States include ABN Amro, which bought Chicago-based LaSalle National Bank in 1979 and Standard Federal Bancorp in 1997; National Australia Bank Ltd., which bought Michigan National of Farmington Hills, Mich., in 1995; and Societe Generale, which bought New York investment banking firm Cowen & Co. in 1998.
A fresh wave of cross-border activity is bound to take off as merger activity intensifies in Europe, Mr. Tortoriello said.
Banks in general must think of diversifying their risk and maintaining a competitive edge, he said.
"Many European banks have a big presence in the United States, and they would view the Deustche-Bankers Trust deal as something to think about," Mr. Tortoriello said.
"These major institutions do not live on Mars. Most of the time they live right down the street from each other, and when they see others merge, serious considerations must be given to competitive threats."
For Mr. Tortoriello, cross-border deals include more than just major companies.
U.S. and foreign banks are buying equity stakes in each other or issuing securities in either the U.S. or European capital markets, said Mr. Tortoriello, who is also the author of "Guide to Bank Underwriting, Dealing, and Brokerage Activities."
This activity "further ties global markets together and provides a free flow of capital between countries," he said.
"This will help increase cross-border mergers, because it will increase the financial flexibility of buyers."
Mergers and acquisitions have come a long way, Mr. Tortoriello said.
"When I started in 1974, it was very difficult for a bank to buy another, he said.
"If you were a bank in New York you could barely buy a bank north of Westchester County. But it is a different world now.
"Most people would think that Citigroup is the largest American lender in Brazil. But it's not," he said.
"The largest lender in Brazil is BankBoston, which was just bought by Fleet Financial Group. Now who would have ever thought that Fleet, once a sleepy bank in Providence, R.I., would have such an international presence?
"I don't think that John McCoy, chief executive of Bank One Corp., is looking to buy a bank in a small European country," Mr. Tortoriello said.
"The point is that once an organization starts to expand and grow, it will eventually look abroad."
