U.S. Bank M&A May Pick Up as Banks Exit TARP

CreditSights reviews the prospects for consolidation in the US banking industry in a new report. ‘There is an obvious acquisition advantage goes for those banks which no longer have TARP funding,” CreditSights says.Top candidates to be acquirers include JPMorgan Chase (JPM), U.S. Bancorp (USB), and BB&T (BBT). “As well, we have included Morgan Stanley (MS) and Goldman Sachs (GS) as potential acquirers, although we feel the strategic case for the investment banks to enter branch banking is less compelling.”

CreditSights also includes four Canadian banks-Royal Bank of Canada, Toronto Dominion (TD), Bank of Montreal/Harris, and Bank of Nova Scotia- as potential buyers in the U.S.

As potential targets, CreditSights includes SunTrust (STI), Regions (RF), Fifth Third (FITB), Key (KEY), Comerica (CMA), M&I, Huntington (HBAN), First Horizon, Zions (ZION), and Synovus (SNV). “We have listed these franchises in their approximate order of merger attractiveness based on our opinion.”

In general, we view the more “critical mass” regional bank franchises such as SunTrust, Regions, and Fifth Third as being more attractive than smaller targets, despite their identified capital need and well-known credit quality issues.

Comments

[DonFurio:]

Remember a few months ago when the idiots (i mean bears) said that all the big banks had to be nationalized.

Jun 01 03:55 PM

[Alex Trias:]

The Rothschilds had it right, after all: the time to invest is when the blood is running in the streets. We certainly saw that last year. I like to think that going forward, what did not kill the banking system of the planet will ultimately make it stronger. We sure came close, last year. Anyhow, if the thought is how to capitalize on a future wave of bank mergers, probably M&A advisory services is a place to look, not just potential takeover targets.

Jun 01 04:41 PM

[Benning Banker:]

Just might be right, was a group of Canadian Bankers and Accountants in town ( Columbus, GA) yesterday out at AFLAC Corporate. Bet they wern't talking about insurance?

Jun 02 08:42 AM

[Perry B:]

I am very confused on what is happening in the banking world. And despite the talk of transparancy. It has been anything but transparant. Those in control; The Congress the State Legislators. Have done a masterful job of duping The American public. In another year we will not even remember this washing we just took. Or who the players were. I look for AIG to liquify the last of its cash through the sale of its stocks in other companies, and then file for bankruptcy. Today it announced the sale of 100% of its stock in a financial credit company to an Argentina based bank. NO mention of what 100% equates to in cash. Nor have they disclosed the cash value of other stock sales they have done in the past few months. But they are milking the biggest cash cow the retail traders and mom pop investors.

Jun 03 03:14 PM