Effect of Trump Presidency on Banking Industry / Geo-Jumping in Bank M&A / Acquisitions and Recapitalizations of Smaller Community Banks

By: Sharon J. Lorman
Jeffrey P. Marsico
Richard B. Trauger, Jr.

Guest: Michael P. Affuso, Esq., Executive Vice President and Director of Government Relations, New Jersey Bankers Association

Podcast Show Notes:

This Month In Banking (TMIB) highlights significant news and events in banking, along with interviews with industry thought leaders. New episodes will be available on the last Wednesday of every month here, on Stitcher, Soundcloud, and iTunes for your listening enjoyment. Join us on your commute or at your desk.

Topic 1: Effect of Trump Presidency on Banking Industry
Start time 1:45
Michael Affuso was TMIB’s guest for this segment. Mr. Affuso currently serves the New Jersey Bankers Association as executive vice president and director of Government Relations. Mr. Affuso provides legal opinions and analysis of proposed and pending legislation that affects the New Jersey banking industry. He also manages relationships with both federal and state legislatures for the NJBankers. Before joining NJBankers, Mr. Affuso served as deputy district director and General Counsel for Congressman Albio Sires and prior that he was the campaign manager for Albio Sires for Congress. Mr. Affuso also served as associate General Counsel for the New Jersey General Assembly Majority Office. Prior to his government service, Mr. Affuso served in various positions at Mellon Bank, Morgan Stanley, Metropolitan Life Insurance/Banker’s Trust and at Merrill Lynch.
Donald Trump was elected the 45th president of the United States on Tuesday November 8th, a surprise victory to many that is sending shock waves through the political and policy establishment. What effect will Trump’s presidential win and the continuing Republican majorities in Congress have on the banking industry? American Banker published an article on November 9th with a broad outline of Trump’s policy positions including tax reform, regulatory relief and health care.

Topic 2: Geo-Jumping in Bank M&A
Start time 17:40
Heartland Financial in Dubuque, Iowa, agreed to buy Founders Bancorp in San Luis Obispo, Calif. The $8 billion-asset company said in a press release that it will pay $29.1 million, or $21.87 a share, in cash and stock for the $199 million-asset Founders. Lynn Fuller, Heartland’s chairman and chief executive, said in the release: “We see the San Luis Obispo County market area as an economically strong and vibrant region and an excellent fit for our community banking business model.” Is geo-jumping the new normal in bank M&A?

Topic 3: Acquisitions and Recapitalizations of Smaller Community Banks
Start time 24:25
First Boston Holdings, an investor group, is acquiring Boston-based Admirals Bank ($446 million in assets as of June 30) and renaming it Bank & Trust Co. of Boston. The deal is likely to close in the first quarter of 2017. Plans for the new entity include a $100 million capital raise, the retention of Admirals’ Back Bay and Providence sites and its expansion into the Seaport District. At the helm of First Boston Holdings is Mark Thompson, former CEO of Boston Private Bank & Trust Co. and president of Boston Private Financial Holdings Inc.
North Garden, Va.-based Old Dominion National Bank is pushing to expand in Northern Virginia and Charlottesville, Va., with a recent capital raise funding plans to open an additional branch in each location. The bank raised $20 million through a private offering and is hoping to raise an additional $10 million. Are acquisitions and recapitalizations of smaller community banks the modern day de novo bank?

Watch for episode 12 of This Month in Banking to be released on Wednesday, December 28, 2016 and a new episode on the last Wednesday of every month.

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