This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

10 Regional Banks in the M&A Crosshairs

Stocks in this article: C BAC JPM SNV RF KEY BBT

Story updated with information on the M&I acquisition.

NEW YORK( TheStreet)-- Bank M&A is picking up, especially among regional players, and the next year could bring a slew of new deals that will push share prices in many directions.

The recent acquisitions of Marshall & Ilsley Corporation (MI) by Bank of Montreal (BMO) and Wilmington Trust's (WL) purchase by M&T Bank (MTB) are just a couple of examples of the type of deal to come. Many industry professionals agree that the transactions will act as a catalyst, prompting more mergers in the financial industry. "That regional acquisition is probably a start of the consolidation in the industry and it was probably the right thing for both M&T and Wilmington Trust," said Scott Fainor, CEO of National Penn Bancshares (NPBC).

"When it comes to acquisitions in finance right now you have the premium takeouts like the First Niagara (FNFG), NewAlliance Bancshares (NAL) deal, and then we are seeing transactions like Wilmington which had more problems than people anticipated it would have," said Fred Cannon an analyst at Keefe, Bruyette & Woods.

Cannon says to expect more of the transactions similar to Wilmington Trust after year-end results as credit continues to deteriorate and banks struggle to meet capital requirements. He adds that impaired credit issues could put Keycorp (KEY - Get Report) in play as well as Synovus (SNV - Get Report).

"I would guess we would see a lot more strategic acquisitions of a lot of very small banks such as Central Pacific (CPF) and National Penn," Cannon said. Even though these institutions have received investments from private equity that won't keep these institutions from being acquired, Cannon explained.

"Private equity investments could actually encourage a sale, in my opinion," Cannon added.

"When opportunities confront us on the M&A front, we will take advantage of any of those opportunities to grow through acquisitions and take advantage of any consolidation that might play out in our market," National Penn's Fainor said in an interview.

KBW's Cannon and Rochdale Securities analyst Richard Bove have been speculating on which institutions may be the next targets to get gobbled up by larger banks. Here's a list of the banks that are likely already being targeted by larger banks, beginning with two smaller holding companies that are in play from the actions of private equity investors, and then moving up by asset size:

1 of 11

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,678.70 +6.10 0.03%
S&P 500 2,057.09 +5.27 0.26%
NASDAQ 4,771.7630 +13.8840 0.29%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs