US Bank M&A Hits Two-Year High In June

Merger and acquisition (M&A) activity among US banks hit the highest level since 2019 in June, according to new data from S&P Global.

Last month, 26 deals were announced, the highest monthly total since September 2019 at 27 deals.

In the first half of 2021, 94 deals were announced compared to 50 over the same period in 2020.

The total deal value has also soared in 2021 to just over $32 billion, compared to $28 billion for all of 2020. The median deal value-to-tangible common equity for deals announced in 2021 rose to 152.4%, compared to 134.8% for 2020.

June also saw the fifth credit union-bank acquisition announcement of 2021 — with Lake Michigan Credit Union acquiring Florida-based Pilot Bank in a $100 million deal.

Ohio was particularly busy in June, with three deals announced, including Farmers National Bank’s $124 million purchase of Cortland Bank.

Tennessee also saw three deals, with a combined value of $278 million, announced within four days.

The data comes just days after President Joe Biden signed an executive order that could result in tighter scrutiny of merger and acquisition deals. The number of US banks has fallen by 70% in 40 years, predominantly through M&A.

When announcing the executive order, the president said: “Less growth, weakened investment, fewer small businesses.  Too many Americans who feel left behind… The executive order I am soon going to be signing commits the Federal Government to full and aggressive enforcement of our antitrust laws. 

“No more tolerance for abusive actions by monopolies. No more bad mergers that lead to mass layoffs, higher prices, fewer options for workers and consumers alike.”

The move is part of a wider executive order designed to promote better competition in the US economy.