Services » Mergers & Acquisitions Assistance

Getting the most bank for your buck

Banks are acquired usually for one of two reasons: because people want to invest, or banks want to expand.

Whatever your reasons for considering the purchase of an existing bank, here are some beginning variables to consider: bank management (current and future), operational synergies between an existing bank and its new ownership, and meeting the standards of organizing a bank if you are an individual investor.

First, the fact that a bank is operating has management in place with an existing infrastructure generally makes acquisition an attractive option to opening a denovo bank, which may take up to three years to become profitable and starts with nothing in place.

With regard to operations, when banks acquire other banks, operational synergies usually occur that enhance the bottom line of the resulting institution. Additionally, the acquiring institution enjoys market growth that aids it in cross-selling and developing services.

When individuals acquire an existing bank, they must file a change of control with the appropriate regulatory agency. Acquirers must meet the same general standards as denovo organizers.

Before you invest, know why you're investing and what you're looking for in a bank or financial institution. Cerfis can help you both ready yourself before an acquisition, and help you to find and know the right bank as it emerges. Talk with us.