The Federal Reserve tightened monetary policy to rein in inflation, spurring banking mergers and acquisitions throughout the year.
As the industry grappled with the rise of the Federal Funds Rate from 0.25% at the beginning of 2022 to 5.25% at the end of 2023, some banks — including Silicon Valley Bank and Signature Bank — suffered a liquidity crunch and saw regulators step in to broker merger deals.
Meanwhile, some major banks also looked to trim their expansive operations by exiting multiple markets and implementing a strategic refocus for their organizations.
Here are Bank Automation News’ top three stories on M&A in banking this year:
1. RBC to buy HSBC Canada for $10B
Royal Bank of Canada agreed to acquire HSBC Canada for $10 billion, with the deal expected to close in the first quarter of 2024.
HSBC International has been restructuring as it looks to trim operations in certain geographic areas while expanding in others, according to an S&P Global 2021 report.
In October, HSBC bought Citibank’s consumer wealth portfolios in China for $3.6 billion. The sale, which included Citi’s clients, assets under management and deposits, aligns with the bank’s plan to end its consumer banking business in China as part of a broader restructuring.
2. BMO, Bank of the West conversion update
BMO Financial Group completed its acquisition of Bank of the West in February and started converting customer accounts to the BMO platform on Labor Day.
The Canadian bank completed the conversion of Bank of the West consumer accounts during its fiscal fourth quarter, according to its Q4 earnings supplement.
With Bank of the West accounts onboarded to the BMO platform, the bank has posted increased customer activity in checking accounts sold digitally on the platform, Chief Executive Darryl White said during the bank’s Q4 earnings call on Dec. 1.
3. Integrating First Republic Bank, JPM tech stacks
JPMorgan expected to spend close to $2 billion integrating First Republic Bank into its operations after spending $13 billion on the acquisition in May.
Acquiring First Republic gave JPMorgan $173 billion in First Republic’s loans, $30 billion in securities and $92 billion in deposits, bolstering its fortress of a balance sheet.
The $3.4 trillion JPMorgan started integrating First Republic into its operations in Q2 and expects to complete the merger by mid-2024, Chief Financial Officer Jeffrey Barnum said during the bank’s second-quarter earnings call in July.
Get ready for Bank Automation Summit U.S. 2024 in Nashville on March 18-19! Discover the latest advancements in AI and automation in banking. Register now.
Vaidik Trivedi
Source link
