A North Dakota bank owner hopes to show that it doesn't take an investment banker to sell a bank.
Paul Richter, who with his father owns 98% of $17 million-asset First State Bank of Goodrich, put a small classified ad in Northwestern Financial Review, Minneapolis.
The offers have been rolling in, he said.
"I didn't realize how many multibank holding companies are looking to buy small banks," said Mr. Richter, who has 30 years of banking experience but now works as a real estate agent in Rapid City, S.D.
Mr. Richter said he put the bank on the market because his 95-year-old father, chief executive Edwin C. Richter, is finding it harder to keep visiting it two or three times a week.
In the for-sale ad the Richters list an asking price of 1.15 times the two-branch bank's capital; that works out to about $1.9 million. The offering includes the Richters' interest in an independent insurance agency in the Goodrich branch. (The other branch is in Hurdsfield.)
Paul Richter said the magazine ad and classifieds in Midwest trade group newsletters have generated about 30 inquiries-mostly from small multistate Midwest banking companies-and a few offers.
The ads cost $350, he said, far less than he would have paid an investment banker to find him a buyer.
Timothy M. Sullivan, a merger-and-acquisition attorney at Hinshaw & Culbertson in Chicago, said an investment banker could charge a small bank owner tens of thousands of dollars for the service.
Mr. Richter said he's been approached by a few investment bankers interested in helping him. "We've had plenty of interest without that," he said.
He plans to stick with the classifieds.
