More than one in three bank executives and directors said that another financial institution expressed interest in acquiring their bank in 2024 or 2025, up from 27% who said the same a year earlier, according to a recent survey of merger and acquisition activity by Bank Director.
Thirty-seven percent of respondents said another financial institution expressed interest in their bank. At the same time, 68% of potential buyers said they would be willing to pay 1.5 times tangible book value or more for a target that meets their criteria, compared with 54% who said the same a year ago, Bank Director reported.
Among respondents who are active buyers or open to acquiring, 41% cited a desire for low-cost deposits as a primary motivation, up from 29% a year ago. Respondents also cited geographic expansion (41%) and scale to drive technology and other investments (38%) among the reasons. Prospective acquirers name pricing expectations of sellers (74%) and a lack of suitable targets (71%) among their top barriers to M&A.
The survey also found that 40% of respondents say their board discusses M&A on a quarterly basis, while 28% discuss it yearly.
