Acquire or Be Acquired – Page 4

January 30, 2015January 30, 2015

Bank Director’s 2015 Acquire or Be Acquired Conference: A Week in Pictures

As we wrap up “AOBA week” there are so many to thank… be it Kelsey for reminding me that “coffee is for closers“… Katilyn, Robert and Daniel for their contributions as recognized by their peers (“stay thirsty my friends”)… Laura, Mika and Michelle for bringing the prize patrol to the golf course… the list goes on & on of the super heroes we had band together to make this year’s event such a success. Also, a HUGE congratulations to our controller, Ryan McDonald, and his wife who welcomed their first child into the world this week (a healthy baby boy). So allow me to share some “behind the scenes” pictures from our time at The Phoenician.

Kaitlyn… holding it down in the “office”

Chelsea’s Kitchen for a pre-AOBA dinner

G+Ts with Robert

Batman & Robin out of costume

Saturday evening’s reception

Bill’s espresso cups get into the act

One of our fancy team dinners

The new point/counterpoint setup

A look into the general session room

Jack wrapping up AOBA with NASDAQ’s help

Kelsey, our ringer on the golf course

The prize patrol — out and about on the golf course

Mika and one of our favorites, Oscar Ortiz

Superheroes… revealed

Don’t be afraid of the french fry

Michelle, I did see the masks

… and yes, we’re heading to New Orleans

Sunday’s reception (c/o Alstrin Photography)

Come on in (c/o Alstrin Photography)

The team! (c/o Alstrin Photography)

The BD orange (c/o Alstrin Photography)

A full breakout session (c/o Alstrin Photography)

Loved the Phoenician (c/o Alstrin Photography)

Thx to all our sponsors (c/o Alstrin Photography)

Handrolled (c/o Alstrin Photography)

Stepping to the podium (c/o Alstrin Photography)

Big thanks to KBW for their continued support – their CEO and me (c/o Alstrin Photography)

Dimming the lights (c/o Alstrin Photography)

If you’re interested to see what we’ve covered, you can click on a number of posts (this video about a CEO panel and this recap of three things I noticed on Sunday, this video about the new consolidators, this video from Sunday night, this written recap from Monday, this video from Monday evening, this video from Tuesday and this written recap from Tuesday). Also, our managing editor, Naomi Snyder, authored a number of great highlights pieces that posted to BankDirector.com. And as a final recap of Acquire or Be Acquired, let me share the video I used to welcome the team to our wrap-up dinner on Tuesday night (w/ thanks to our friends at Snapshot for doing this with me!)

P.S. – it is Aloha Friday!

January 28, 2015

Wrapping Up Bank Director’s 2015 Acquire or Be Acquired Conference

To paraphrase the New England Patriot’s Bill Belichick, we are #OnToNashville. Yes, Bank Director’s 2015’s Acquire or Be Acquired conference is solidly in the books and our annual Bank Board Training Forum at the historic Hermitage hotel in Nashville, TN is now “on the clock.” But before I depart from sunny Arizona, a very big thank you to everyone who made this possible!

January 27, 2015January 27, 2015

Three Observations From Bank Director’s 2015 Acquire or Be Acquired Conference (Tuesday)

News and notes from the final day of Bank Director’s annual Acquire or Be Acquired conference.

Key Takeaway

As always, the one constant in life is change. Right now, with deflation in the Eurozone (is it time to bid Greece goodbye from the EU?), declining oil prices and the sluggish growth of the U.S. economy, optimism about banking’s future is tempered by present uncertainties. As we heard from KBW, a handful of factors have contributed to the slower pace of our economic recovery:

Resetting of global GDP growth expectations;
Europe nearing closer to deflation;
Japan expanding its stimulus spending;
Modest wage growth; and
Conservative consumer and small business confidence.

Nonetheless, there is a true sense of optimism permeating the conference here at The Phoenician… especially in terms of the future of community banking.

Picked Up Pieces

I made note of the following this morning:

Google’s partnership with Lending Club came up early and sparked quite a few sidebar-type conversations;
New skills, better analytics is where bigger banks are struggling the most.
Per Josh Carter at PwC, mobile phones, wearables and integrated devices (car, shopping cart, item RFID tags) have barely scratched the surface in terms of how they will shape our lives.
Several presenters noted the multi-charter bank model is under pressure.
Looking ahead, bank stocks may struggle to outperform the broader market if unable to meet earning-per-share (EPS) expectations.
By extension, if the Federal Reserve does not raise interest rates, EPS estimates will be at risk for negative revisions.

I will post a recap video tomorrow morning on About That Ratio and you can use the hashtag #AOBA15 to read through the last three days tweets. Now, it is time for me to head out to the golf course to shake off the rust at our annual golf tournament.

January 27, 2015January 29, 2015

From Bank Director’s 2015 Acquire or Be Acquired Conference: A 45 Second Video Recap of Day Two

On Tap For Day Three

Last night, I shared three takeaways from our second full day at AOBA (Three Observations From Bank Director’s 2015 Acquire or Be Acquired Conference). Looking ahead to our final half day, we kick things off with a series of discussion groups that address the following issues:

New Lending Markets for Community Banks
Growing with SBA Loans
Everything You Wanted to Know about Civil Money Penalties
Capital Plans & Nontraditional Alternatives
Incorporating M&A into Your Strategic Planning Process
Beyond eMail – Purpose-Built Tools for Mobile Executives

With coffees in hand, we move into our first general session, led by PwC, entitled “What You Can Learn from the Country’s Biggest Banks.” Following that presentation, we have back-to-back breakout sessions available before closing with “The Butterfly Effect of Technology on Banks Today.” To see an abbreviated PDF version of the three day agenda, please click 2015 AOBA Agenda (Overview).

To follow the conversation on Twitter, I invite you to follow me @aldominick, follow @bankdirector and tweet using the hashtag #AOBA15.

January 26, 2015January 26, 2015

Three Observations From Bank Director’s 2015 Acquire or Be Acquired Conference (Monday)

News and notes from the second day of Bank Director’s annual Acquire or Be Acquired conference.

Key Takeaway

My biggest takeaway from the second full day of Acquire or Be Acquired (#AOBA15 via @bankdirector): instead of asking why take the risk of doing a deal or why take the risk of creating a high performing bank, a better question might be can you be relevant if you don’t?

Picked Up Pieces

A really full day here in Scottsdale, AZ with quite a few spirited discussions/debates. Here are some of the more salient points I made note of throughout the program:

The only thing worse than a flat yield curve is an inverted one.
If stocks do well after a deal, means you have the runway to do more deals in the future.
When it comes to buying another institution, keep in mind just because somebody has the money doesn’t mean they are going to spend the money.
Per Bill Hickey at Sandler O’Neill, capital markets are “open for business” given the lower rate environment and attractive yields/costs for both issuers and investors alike.
Without big bank M&A, community groups now review and protest transactions by much smaller banks.
A fundamental truth: as you grow, compliance & regulatory expectations grow with you.

More to come from The Phoenician and Acquire or Be Acquired tomorrow morning.

January 26, 2015January 26, 2015

From Bank Director’s 2015 Acquire or Be Acquired Conference: A 45 Second Video Recap of Day One

On Tap For Day Two

Last night, I shared three takeaways from our first day at AOBA (Three Observations From Bank Director’s 2015 Acquire or Be Acquired Conference). Looking ahead to our second full day, we kick things off with a series of discussion groups that address the following issues:

IPO or Sale? Key Factors Bank Executives Should Consider
How Banks Should Make the Decision to Sell or Buy – Lessons for Buyers & Sellers
How Size Matters: Regulatory Considerations for Deals
How Does a Buyer Begin The M&A Process?
The Characteristics of a Well Received Deal: The Importance of Gauging the Market’s Reaction For Both Buyers and Sellers

From there, we move into various general and breakout sessions. These range from presentations on “The Power of In-Market Mergers” to “Are You a Buyer or Seller… or Something Else?” To see a high-level, PDF version of the three day agenda, please click 2015 AOBA Agenda (Overview).

This afternoon, I’ll post a brief video recap of our first general session and later, three things I picked up over the course of the day. To follow the conversation on Twitter, I invite you to follow me @aldominick, follow @bankdirector and tweet using the hashtag #AOBA15.

January 25, 2015January 26, 2015

Three Observations From Bank Director’s 2015 Acquire or Be Acquired Conference (Sunday)

News and notes from the first day of Bank Director’s annual Acquire or Be Acquired conference.

Key Takeaway

As was the case at last year’s Acquire or Be Acquired, the most successful banks have a clear understanding and focus of their market, strengths and opportunities. One big takeaway from the first full day of Bank Director’s conference (#AOBA15 via @bankdirector): to be a successful player in today’s bank M&A market, one needs adequate capital and earnings for regulatory approval of a deal, the infrastructure in place to both acquire and grow an institution and available sellers in the bank’s target market.

Picked Up Pieces

I had a chance to talk with a number of attendees and introduce quite a few of our presenters. Here are some of the anecdotes I made note of throughout the day:

There were 281 bank M&A transactions in ’14 as compared with 214 in ’13.
This M&A activity, in terms of deal value, increased from $14bn in ’13 to $18bn in ’14.
Whereas Mergers-of-Equals (MOEs) were the hot topic at this time last year, I can count on one hand the number of mentions today.
Per KBW, we have had 20 current straight quarters of improving credit quality — the longest since 1991.
According to Curtis Carpenter with Sheshunoff Investment Banking, 19x earnings is becoming a common median deal price.
From a discussion on M&A-related capital raising… “in general, the pool of private placement buyers is increasing and includes many private equity firms as well as traditional institutional investors.”
Bank executives would be wise to plan for this low-rate environment to last “forever.”

More to come from The Phoenician and Acquire or Be Acquired tomorrow.

January 25, 2015January 26, 2015

From Acquire or Be Acquired: A Video Recap of Today’s L. William Seidman CEO Panel

Former FDIC Chairman and Bank Director’s Publisher, the late Bill Seidman, was a huge advocate of a strong and healthy community bank system. We honor his memory and this sentiment with a CEO panel each year. My thanks to David Brooks, Chairman & CEO of the Independent Bank Group, Mark Grescovich, President & CEO of the Banner Corporation, Edward Garding, President & CEO of First Interstate BancSystem and Daryl Byrd, President & CEO of IBERIABANK, for sharing their thoughts on a variety of growth-related issues earlier today.

January 22, 2015January 22, 2015

Bank Director’s 2015 Acquire or Be Acquired Conference

Banks are increasingly interested in the topic of mergers and acquisitions, which must have something to do with our record attendance at this year’s Acquire or Be Acquired Conference in Scottsdale, Arizona.

The fun begins at The Phoenician (pictured above) this weekend with Bank Director’s 21st annual “AOBA.” Last year, we welcomed 435 officers & directors from 271 financial institutions to the Arizona Biltmore. This year, we have 522 bankers and bank board members from more than 300 banks in attendance. Merger activity is clearly gaining steam, and this is bringing more interested parties to the table.

Three Days in the Desert

Why banks are bought (or sold) involves much more than just the numbers making sense. Moreover, to successfully negotiate a merger transaction, buyers and sellers must bridge the gap between a number of financial, legal, accounting and social challenges. So allow me to sketch out what’s on tap for this massive three-day event.

On Sunday…

To kick things off, we take a macro-level look at capital markets and operating conditions for banks nationwide. Additionally, we look at how M&A fits within a broad range of strategic options for a bank’s board and how some successful acquirers have aligned transactions to achieve strategic goals. Of note, we welcome the perspectives of CEOs from high performing banks like Pinnacle National Bank, Banner Corp., First Interstate BancSystem, IBERIABANK and CVB Corp. as part of several presentations. On stage, these men will share their thoughts on what it takes to build and lead successful institutions.

On Monday…

Building on the first day of the conference, we turn our attention to the long-term preparation required by both a buyer and seller. For instance, regulatory planning remains critical to getting deals done for both sides — especially on compliance issues. Thematically, Monday builds on Sunday’s presentations, with sessions dedicated to helping a bank’s board make a rational buy, sell or hold decision.

On Tuesday…

To put a bow on this year’s event, we start with a look at what the biggest banks are doing today followed by a series of breakout sessions on more in-depth topics. To conclude, we welcome the perspectives of our friends from NASDAQ who will look at trends, issues and the “movers and shakers” in the technology world that may impact growth and innovation within the financial community. As much as AOBA explores one’s financial growth opportunities, this final session examines what’s happening outside of our industry that may precipitate new changes or challenges to a bank’s growth aspirations. Oh and in the afternoon… we swap suits for cleats, wrapping up AOBA with our annual golf tournament.

Can’t Make it?

For those not able to join us — but interested in following the conversations — I invite you to follow me on Twitter via @AlDominick, the host company, @BankDirector, and search & follow #AOBA15 to see what is being shared with our attendees.

May 16, 2014May 16, 2014

Time To Sell The Bank?

From the the appeal of spreading into new geographies to the attractiveness of acquiring exceptional talent to drive new sources of revenue, the need and desire to grow exists at virtually every financial institution. For those pursuing another bank, a merger or acquisition (M&A) provides an avenue to drive earnings while improving operating leverage, efficiency and scale. I have written about M&A from a potential buyers point-of-view (e.g. Acquire or Be Acquired – Sunday Recap); today’s piece flips the script and highlights three issues that may precipitate a sale.

2006

2011

2013

Compliance Costs

Banks are facing some very significant challenges in the years ahead — and not just from consolidation. As KPMG shared in its An Industry At a Pivot Point, “the costs and time stresses created by the regulatory environment are not going away, and will continue to affect four areas for banks: strategy and business models, interactions with customers and client assets, data and reporting structures, and governance and risk capabilities.” Certainly, the sharply increased cost of regulatory compliance might lead some to seek a buyer; others will respond by trying to get bigger through acquisitions so they can spread the costs over a wider base.

Capital Concerns

Some banks will have to raise capital just to meet the Basel III requirements, while others will have to raise capital to do an acquisition or support their organic growth. The required levels are so much higher now that banks will have to manage their capital much more closely than they did before. (*If you’re looking for a central resource for the many ongoing regulatory changes that are reshaping bank capital and prudential requirements in the United States, take a look at Davis Polk’s excellent Capital and Prudential Standards Blog.)

Earnings Pressure

As the attractiveness of branch networks and deposit franchises dwindles, lack of top-line growth will lead to further industry consolidation. With little overall changes in our economy, in-market mergers between banks with significant overlap in branches and operations offer tremendous cost-saving opportunities when done skillfully.

To comment on this piece, click on the green circle with the white plus sign on the bottom right. Aloha Friday!

April 4, 2014April 4, 2014

FI Tip Sheet: First Quarter Favorites

As I come off of a great week in Chicago and Bank Director’s annual Chairman/CEO Peer Exchange, today’s post takes a look back at the first three months of the year. Yes, certain discussions during this time focused on tepid loan growth, higher capital requirements and expense pressures & higher regulatory costs hitting banks today. Nonetheless, many more conversations focused on growth, innovation and “what’s working.” So, to wrap up this week, three points from the past ninety days that inspired me.

Some of Banking’s Best

To kick off the year, I put together a two-part series on some of the top CEOs in our industry. Inspired by my coach and an article entitled the “Best CEOs of 2013” that ran on Yahoo Finance, I reached out to a number of colleagues that work for professional services firms to ask their thoughts on the top CEOs at financial institutions — along with why they hold them in such regard. Part one shared various thoughts on some of the best CEOs in the business today — broken down into three categories: the “biggest banks” with $50Bn+ in assets, those with more than $5Bn but less than $50Bn and finally, those in the $1Bn to $5Bn size range. Part two built on that piece, highlighting three exceptional CEOs that lead publicly traded banks before shifting to the thoughts and opinions of two very talented colleagues.

Eat or Be Eaten

As the President of Bank Director, I’m lucky to lead one of the industry’s biggest (and dare I say best?) M&A conferences: Acquire or Be Acquired. Let me first offer up big time props to my many talented colleagues for everything they did to make this year’s the biggest and best yet! One of the cool new things I did at the Arizona Biltmore this year? Film a 90 second or less video each evening that summarized the day’s salient points. As much as I shared big takeaways in written form on this site (e.g. what if I told you that by December 31, 2018, we’d witness a 25% decline in the number of institutions between $500mm and $1Bn), I’m proud of these two videos from the desert that relayed what caught my eyes and attention on two of the three conference days.

The Innovator’s Dilemma

In my role, I find myself talking with Chairmen and CEOs about their strategic plans. This year, quite a few shared their thoughts for leveraging financial technology to strengthen and/or differentiate their bank. In a piece I shared at the end of February, I cited Clayton Christensen’s “The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail.” His book inspired that Friday’s FI Tip Sheet title – and first point. If you’re not familiar with his work, the Harvard professor writes about two types of technologies: sustaining and disruptive. Sustaining technologies are those that improve product performance. As he sees it, these are technologies that most large companies are familiar with; technologies that involve improving a product that has an established role in the market.

Most large companies are adept at turning sustaining technology challenges into achievements. However, large companies have problems dealing with disruptive technologies — an observation that, in my view, does not bode well for many traditionally established banks. While risk is inherent to banks of all sizes, taking chances on emerging technologies continues to challenge many officers and directors… a theme I anticipate covering in greater detail over the next 90 days.

Whether this is your first time or 78th time reading About That Ratio, let me say thank you for doing so. It is a real treat to share, each Friday, three short stories about what I’m hearing, learning and talking about as I travel around the country. Being that I meet with so many interesting people — be it a bank’s CEO, board members or executives at professional services firms and product companies — I find it tremendously rewarding to share anecdotes and insights that might interest others. As always, Aloha Friday!

January 31, 2014January 31, 2014

FI Tip Sheet: This Week in Pictures

As I wrap up the week, let me take a look back at Bank Director’s 20th annual Acquire or Be Acquired conference vis-a-vis video recaps and a gallery of pictures from the Arizona Biltmore.

Sunday Recap

If you’re curious for a <90 second summary of our first day in the desert, take a read at what I wrote or look at these two videos. The first, of our talented editor Jack Milligan; the second, my two cents.

Monday Recap

The second full day of the program built on Sunday’s discussions relative to growth, profitability, efficiency and the need for scale. Jack and I both shared our thoughts in these video pieces and I also authored a piece that can be found here.