The banking industry confronts an uncertain year with regards to interest rates and possible regulatory changes post-election. Net interest margin expansion will be paramount as banks work to decrease their deposit costs. A long-awaited rebound in bank stocks in late 2024 lost steam in early 2025 but could still lead to improved bank M&A prices, as well as increased deal volume, reversing the trends seen since 2023 which began with a few high-profile bank failures in March of that year. To better inform banks as they plan strategically for the future, we will study the current trends in bank performance and valuation levels for bank stocks and M&A transactions after a period of historically weak M&A volume and pricing in 2023 and 2024.
In this session we will:
- Evaluate community bank performance trends including loan and deposit growth, NIM changes
- Analyze asset quality, both lagging and forward indicators, for signs of change
- Examine publicly-traded bank stocks and AOCI bond losses and the likely implications for M&A pricing and activity
- Discuss the outlook for bank M&A from the perspective of both buyers and sellers
- Consider what to expect from bank stocks and M&A in 2025