The Savvy Banker

Bank Mergers: Who is sincerely interested in our bank?

For this newsletter, I am going to assume you have hired an investment banker.

I am also going to assume the board has chosen to go the route of “strategic approach” in going to the market. (For a refresher on the three types of approaches, see The Savvy Banker 005).

You plan on inviting more t...

6 Fantastic Ways to Educate the Board on Community Bank Mergers

In the six or seven years leading up to the board’s decision to explore whether our bank would be of interest to a buyer, we invited an investment banker as a guest speaker at our Annual Meeting of the Shareholders.

The importance of having a relationship with an investment banker was instill...

Bank M&A: The right way to clarity in an investment banker?

When you bring serious people to the table, you are signaling to your potential buyer pool,

“We are serious.”

Your advisor team are the serious people you are bringing to the table.

Your investment banker, your lawyer, and your accountant.

For those who may be thinking, “I don’t want...

Best Exit Strategy? You want a strong bank you can own forever or sell tomorrow.

In 2017, our bank was eleven years old.

Our loan-to-deposit ratio was running consistently at 100%+.

We had $40 million borrowed on our Federal Home Loan Bank (FHLB) line of credit.

We had $60 million in bonds that we were holding in an unrealized loss position in at the time.

The unexpect...

Community Bank CEO’s: Why is it good to have an exit strategy?

Every day as a bank CEO, you struggle to balance plates on sticks.

Competitive threats, talent management, management succession, asset quality, liquidity, cybersecurity threats, interest rates, regulatory compliance, regulatory overreach, capital planning, along with customer and shareholder...

Bank Directors – Other People’s Money: What do your shareholders actually desire?

As a bank CEO you are familiar with acting as a fiduciary.

We all can become “house blind” to the specifics of those duties.

Reviewing the fiduciary duties of good faith, care, and loyalty are helpful, especially when selling the bank.

Directors should ensure they are well-informed and knowled...

Successful Bank Sale: Are your people attracting buyers? (Part 2)

In Part 1 of this newsletter, we discussed the importance of making yourself replaceable as CEO.

That requires hiring the right people, developing them, and protecting your investment of time and resources.

You have perhaps kissed more than your fair share of toads along the way looking f...

Successful Bank Sale: Are your people attracting buyers?

Your job as the CEO is to make yourself replaceable.

You do that by hiring the right people to keep the company going without you.

Don’t get me wrong, you have unique and specialized talents like being a visionary, being adaptable, being a motivator, and being receptive as a listener.

Yo...

Community Bank CEOs: Know your winning value to a bank buyer?

Banks are bought, not sold.

They are bought because the buyer thinks the value of their bank will increase with the addition of your bank.

The buyers aren’t as interested in the past as they are in the future.

Finding the areas where the combination of two banks creates value greater tha...

Successful Community Bank Sale: Do you know your Golden Window of Opportunity?

If you could pick a time that presents the “best” time to begin the process of looking for a buyer, what would you base it on?

I would base it on the moment when your safety & soundness, BSA and IT exams have just successfully completed, and you have 18 months until the next exam cycle (reali...