Increasing regulation, compressed earnings, competition, and financial institution failures have presented opportunities for financially sound forward-thinking institutions and investor groups. The opportunities are presented in the form of financial institution acquisitions and purchases of assets or pools of assets.
Once an acquisition target has been selected or an opportunity provided, the situation must be thoroughly investigated and appraised. Initially, this may be the gathering and analysis of all publicly available data before contact with the acquisition candidate. If the initial analysis is positive and the acquisition candidate is receptive, a comprehensive due diligence study is undertaken within the institution. When a financial institution due diligence review is conducted by PBS, this study not only includes the vital loan portfolio but may also encompass investment securities, consumer compliance issues, an analysis of operations, a review of staffing, a determination of management ability, an evaluation of the compensation and retirement programs, and an opinion as to the cultural compatibility of the target’s personnel and community.
Financial institution assets or pools of assets can be evaluated either onsite or, if the seller has the technological capability, offsite through a secure remote network connection. PBS conducts significant up-front preparation for this service that enables us to efficiently conduct the review without disruption to the institution.
When a failing institution is a target, time and an understanding of the failing institution acquisition process is as important as the due diligence.
PBS has serviced clients well in these types of acquisitions.