(JPM - Get Report)
in September from the Federal Deposit Insurance Corp. for $1.9 billion, just six months after it purchased
in a government-assisted deal.
Bank of America
(BAC - Get Report)
is struggling to digest
and also bought
already agreed-upon deal for
, ultimately winning a legal battle for the rights to the Charlotte, N.C. company.
Acquisitions also have made regionals like
PNC Financial Services
(PNC - Get Report)
unlikely to be a buyer, as it digests its deal for
and works to rebuild its capital levels.
PNC completed the Nat City deal last year, paying close to $6 billion for the bank as it received a $7.6 billion preferred equity investment from the government through the Troubled Asset Relief Program. PNC did not have a loss-sharing agreement with the government, despite Nat City's troubled balance sheet. On the other hand, US Bancorp bought
Downey Savings and Loan
PFF Bank & Trust
late last year with help from the government.
Other banks are also reluctant to take on significant deals these days, regardless of their credit standpoint, because they don't want their current capital levels to take even further hits.
Still, the cheap prices that healthy banks could acquire franchises at these days is almost too good to pass up.
"Every bank has that wish list," says Oppenheimer analyst Terry McEvoy, adding the companies would have had to pay a premium to acquire its targets before the credit crunch. These days, banks are more apt to take only the attractive deposits and branches of those firms and leave the assets that pose a credit risk for the government to deal with, he says.