Capital is flowing to all kinds of bank deals

With 229 merger and acquisition deals announced through the end of November, 2018 is well on its way to being an active year for bank transactions. The year offered a seller’s market, especially for banks in urban areas, and even more so if the bank had ample deposits. Large banks with widely-traded stock generally paid the highest prices this year.

BankBeat provided stories on many of the deals involving financial institutions in the Midwest. Some of the deals capturing our attention include Associated Bank’s first acquisition in 10 years, a move to purchase Bank Mutual Corp. Then there was Choice Financial’s purchase of Venture Bank, the successful Bloomington, Minn., de novo won over by one of North Dakota’s most dynamic bank franchises. Bridgewater Bank, another impressive de novo story, continues to win support, this time from the public who bought up more than $58 million in shares in an IPO.

CorTrust, owned by the Hopkins family of Mitchell, S.D., purchased the State Bank of Delano, Minn., long operated by Steve Gilmer and before that by his father Don. That was one of many deals involving one community bank purchasing another community bank. For other examples, see: First National Bank of Ames, Iowa buying Clarke County State Bank, Osceola, Iowa, or Freedom Bank of Elkader, Iowa buying Farmers & Merchants Savings Bank of Waukon, Iowa, or Blackhawk Bank of Wisconsin buying First McHenry Corp., of Illinois.

Branch deals were big, including Flagstar Bank’s purchase of 52 branches in Michigan, Indiana and Ohio from Wells Fargo, or Associated Bank’s purchase of Huntington Bank’s Wisconsin branches.

Old National announced on June 21 it would purchase KleinBank of Chaska, Minn. That deal, along with Old National’s previous purchase of St. Paul-based Anchor Bank, solidified Old National’s entry into the Twin Cities market. In August, MidWestOne of Iowa City announced it is purchasing ATBancorp., which includes American Trust, a venerable name in the Dubuque, Iowa market. For in-depth details on these deals, click here and here.

Other deals that intrigued the editors at BankBeat: a Minnesota investor group purchased the Minnetonka, Minn.-based MidCountry Bank from MidCountry Financial Corp of Macon, Ga., in June; Park Financial Group, which owns Park Bank of Duluth, Minn.,  purchased a substantial minority share in Mesaba Bancshares, of Grand Rapids, Minn. Park’s current owners purchased that bank in 2014. And First International Bank & Trust of Watford City, N.D., purchased a payments processor called Intercept EFT.

And the credit unions have emerged as real players in the bank-buying arena. We had at least five stories of credit unions buying banks or bank branches: KleinBank sold branches to Wings Financial CU; Marine Credit Union bought 10 branches from Old National; Sound Credit Union announced it would buy the Bank of Washington; Advia Credit Union announced an agreement to buy Golden Eagle Community Bank in Woodstock, Ill., and a Michigan credit union bought branches from a Wisconsin bank.