This Day On The Street
Continue to site
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

'Massive Increase' in Bank M&A Coming: Hedge Fund Pro

NEW YORK ( TheStreet) -- Bank M&A will see a "massive increase" in the second half of 2012, argues Tom Brown, a longtime sell-side bank analyst who has spent several years running financial services hedge fund Second Curve Capital.

Brown, who made the comments during an interview with Bloomberg TV late Tuesday, believes the bulk of the deals will occur among banks with between $1 billion-$50 billion in assets, since the roughly 30 banks with between $50 billion-$600 billion in assets will need to pass regulatory "stress tests" before they are allowed to make acquisitions, a policy Brown claims has "made it hard for large banks to continue to grow."
Second Curve Capital CEO Tom Brown

Brown did not specify which banks he believes will be involved in the dealmaking frenzy, though industry observers have been arguing ever since the 2008 crisis that major consolidation among small and mid-tier players is inevitable on the theory that new regulatory requirements make it difficult to make a profit and it is hard for lesser-known banks to meet higher capital standards.

Financial services-focused investment bank Keefe, Bruyette & Woods has kept a close eye on completed and expected bank deals, publishing a weekly report on the topic. The latest report, published Sunday, lists 23 institutions KBW sees as likely takeout targets, including Synovus Financial Corp. (SNV - Get Report), BancorpSouth (BXS) and Astoria Financial Corp. (AF).

A separate list names 14 "potential buyers who could become sellers," including BankUnited Inc. (BKU - Get Report) and TCF Financial Corporation (TCB).

The list of potential buyers includes more than 50 names, among the largest of which are U.S. Bancorp (USB - Get Report), BB & T (BBT - Get Report), and M & T Bank Corp. (MTB - Get Report).

-- Written by Dan Freed in New York.
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr 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

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BKU $34.49 -2.27%
BBT $35.60 -1.52%
MTB $119.14 -1.07%
SNV $31.19 -1.30%
USB $43.13 -0.92%


Chart of I:DJI
DOW 17,830.76 -210.79 -1.17%
S&P 500 2,075.81 -19.34 -0.92%
NASDAQ 4,805.2910 -57.85 -1.19%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs