2026 Bank M&A Survey: Improved Pricing Brings Sellers to the Table

The gap between buyers’ and sellers’ pricing expectations may be closing as potential acquirers look for ways to add low cost deposits.

Bank executives and directors taking part in Bank Director’s 2026 Bank M&A Survey, sponsored by Crowe, suggest they’ve had more conversations about dealmaking in the past year. Thirty-seven percent report that another financial institution expressed interest in acquiring their bank in 2024 or 2025, up from 27% who said the same a year earlier.

Potential buyers may be more willing to pay higher multiples, too, which could bring more sellers to the table. Forty-four percent of survey respondents say they would be willing to pay up to 1.5 times tangible book value for a target that meets their criteria, and 20% would pay up to 1.75 times tangible book value, compared with 40% and 9% who said the same a year ago.

That shift in expectations could reflect higher pricing multiples in bank deals to date in 2025. According to an analysis by S&P Global Market Intelligence, which measures deal value to tangible common equity, acquirers paid a median 150% of tangible common equity as of Sept. 2, 2025, compared with 131% in 2024 and 124% in 2023.

Among respondents who are active buyers or open to acquiring, 41% cite a desire for low cost deposits (41%) as a primary motivation, up from 29% a year ago. Respondents also cite geographic expansion (41%) and scale to drive technology and other investments (38%) among the reasons M&A factors into their strategy.

A quarter of respondents say their bank is somewhat or very likely to buy branches in 2026, up from 18% who said the same last year. Patrick Vernon, strategy and transaction advisory partner at Crowe, says he’s advised some bank clients on branch acquisitions over the past year and notes deposit acquisition was the primary motivation, rather than geographic expansion.

Funding costs, rather than slow loan growth or regulatory compliance, remain the No. 1 obstacle to profitability, according to 61% bank leaders. Respondents also express concern about the impact of technology costs (48%) and compensation and benefits expenses (45%), which are elevated compared to last year’s survey.

“Something common that we’re hearing in the industry is, ‘How do we attract and retain depositors?’ and ‘What’s the value in a strong deposit book?’” Vernon says. “There aren’t really effective ways to go out and get a large number of deposits in the market right now if you’re not considering M&A.”

Boardroom Discussions
Forty percent of survey respondents say their board discusses M&A on a quarterly basis, while 28% discuss it yearly. In those discussions in 2025, boards focused on M&A in the context of overall strategy (73%), potential targets (65%) and M&A trends (58%). 

Angling For a Better Price
Forty-four percent say they could grow fee-generating businesses in order to get a better price in a sale. Twenty-nine percent see a need to reduce their concentration of non-core, higher cost deposits, and 19% could renegotiate key vendor contracts. Twenty-two percent believe that no changes are needed. 

Mixed Plans on Subordinated Debt
Twenty-one percent report their bank has subordinated debt that’s set to mature or reset in 2025 or 2026. Of those, 31% have not yet decided how they want to address it. Others plan to raise new debt to replace it (23%), let the interest rest float as the debt amortizes (23%) or use existing capital to call the debt (23%). 

Organic Growth Drivers
Respondents largely expect commercial real estate (67%) and commercial and industrial lending (65%) will fuel organic growth in 2026. Additionally, 38% expect growth from fee-driven businesses, such as wealth management and treasury management.   

Limited Interest in Crypto
In July 2025, federal banking regulators released guidance for banks looking to provide crypto or digital asset custody services, but few banks seem interested in exploring it. Just 21% say their institution is looking into providing these services, while 44% have not even discussed it. 

Optimistic on the Economy
Fifty-seven percent anticipate that the U.S. economy will grow at a moderate pace through the end of 2026, while 15% anticipate a downturn or recession. 

To view the high-level findings, click here.

Bank Services members can click below to access the complete results, broken out by asset category and other relevant attributes. To find out how your bank can gain access to this exclusive report, contact [email protected].