Keefe Bruyette & Woods analyst Brady Gailey said Abilene, Texas-based First Financial Bankshares Inc. is ready to pay a "big price" for high-quality M&A opportunities and is actively pursuing nonmetro targets.
First Financial, with roughly $8 billion of assets, would entertain deals up to $1 billion in assets before it crosses the $10 billion mark, according to Gailey. Otherwise, the company would like an approximately $3 billion-asset deal to help overcome its "Durbin decline" of approximately 5% of earnings, he wrote.
Citing meetings with First Financial executives, Gailey noted that many of the targets the bank is pursuing are currently not ready to sell.
The analyst also says Plano, Texas-based LegacyTexas Financial Group Inc. is unlikely to buy anything in the near term or consider a merger of equals. However, selling the company still feels like an option, given its $9.3 billion-in-asset size and "attractive" Texas geographies.