BankDirector.com highlights the importance of community banks need to focus on improving efficiencies and enhancing organic growth prospects. As big banks invest in customer acquisition, and non-traditional players continue to eat away at earnings potential, bank CEOs and boards need to think about what a successful deal looks like.
Bank boards should be particularly mindful of shadow banking’s strong growth. Earlier this month, FT Partners, an investment bank, presented its “CEO Monthly Securities and Capital Markets Technology Market Analysis.” Focused exclusively on the financial technology (FinTech) sector, the company lays out investor interest and pricing expectations for FinTech companies. When it comes to values assigned financial technology companies, there is quite a juxtaposition when compared to traditional banks, brokerage firms and trust service banks. FT Partners also lists recent funding announcements with details on each FinTech company. With lots of money—and potential customers—at stake, I believe more banks should consider aggressively growing one’s franchise through M&A than in previous years. Competition comes in so many shapes and forms that sitting idle while others take market share does not bode well.