|
Bank Director Magazine - 2002 - M&A Supplement
Strategic Positioning: Achieving Synergy through M&A
9/11. War. Recession. Enron.
It’s been a cataclysmic year for business, and yet the banking industry has managed to stay afloat and fend off many of the downcycle challenges faced by a vast variety of companies since last fall. How is that possible? And what’s ahead for institutions looking for ways to further enhance growth and increase shareholder value in 2002 and beyond? Experts we interviewed for this supplement say mergers and acquisitions are alive and well, and will continue to play a significant role in promoting the health and viability of the financial services industry.
The most significant issue for banking companies looking to buy or sell today is the matter of strategic fit. The days of four times book are over—financially, bank owners must consider the long-term value of a sale or an acquisition. More important today is the way in which an acquisition plays into the strategic plan of the buyer, either by expanding a current business line, moving into a geographic region that makes sense, or starting a de novo business that is needed for a more complete product offering. Strategic decisions such as these are at the heart of a board member’s job to oversee the long-range plan and maintain shareholder value by promoting earnings growth.
Bank Director sat down with several panels of experts to more fully discuss the most important issues for bank boards today with regard to mergers and acquisitions. The series of roundtables that follow cover topics such as the competitive landscape for M&A, the post-pooling environment, evaluating potential deals, nonbank acquisitions, compensation and other social issues, and how to develop a strategic rationale. In addition, we included a separate article on the dos and don’ts of strategic alliances—an ever-growing means of business expansion that has its own set of challenges and opportunities.
Despite the psychological and financial tumult of the past year, the outlook is overwhelmingly optimistic for banks and directors who understand and promote good strategic planning and have the skills necessary for its execution. This supplement is an overview many of the issues with which banks boards will likely deal in the coming year as they strive to strengthen their institutions’ earnings and increase shareholder value through mergers and acquisitions.
2002 - M&A Supplement
|
