Friday, October 29, 2010

Mergers & Acquisitions

Every morning I run several searches on community bank news and press releases. As recently as 3 weeks ago those searches resulted in article after article on the troubles, the management change, the consent order, the closure of branches, and so on.
Today, those same searches yield positive earnings and merger/takeover announcements. A lot of really good banks in our universe are trading at or near 50% of book value, that is about to change rapidly. By the spring of 2011 we will see those same stocks at or above book value.
I had a brief discussion yesterday with a group who is raising $100,000,000 to buy these banks now before they start this run.

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