Bank Buyout Boom Stalls Before It Starts

One executive at a large buyout fund says he welcomes the tougher regulations, because all they do is make it more expensive to buy a bank, which will reduce the number of bidders. He says he was never going to be able to compete with JPMorgan Chase (JPM) or U.S. Bancorp (USB), but that now, at least, he is spared from having to bid against "every Tom Dick and Harry" who wants into the banking sector.

In short, there will be more private equity deals in the bank sector. But the wholesale takeover of the industry initially feared by some clearly is not happening.

-- Written by Dan Freed in New York.