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In This List

Ranking the rainmakers in 2016

Street Talk Episode 68 - As many investors zig away from bank stocks, 2 vets in the space zag toward them

Street Talk Episode 66 - Community banks tap the debt markets while the getting is good

Street Talk Episode 67 - Veteran investor tabs Mick Mulvaney to help with latest financial stock-focused fund

Street Talk Episode 65 - Deferral practices trap US bank portfolios in purgatory

Ranking the rainmakers in 2016

A pair of multibillion-dollar bank deals in the Midwest propelled a few names to the top of the lead banker rankings in 2016.

The number of announced bank and thrift transactions with deal values over $1 billion rose to six in 2016, the highest level of any year since the financial crisis. Four transactions with values exceeding $1 billion were announced in 2015, up from two of those transactions announced in each of the previous three years.

Two billion-dollar-plus deals surfaced in late January 2016. FirstMerit agreed to sell to Huntington Bancshares Inc. for $3.44 billion, in what proved to be the second largest deal announced in 2016. The same day, Michigan-based banks Chemical Financial Corp. and Talmer Bancorp unveiled plans to merge in a $1.09 billion transaction.

Sandler O'Neill & Partners LP advised FirstMerit on its sale, with Robert Albertson, Eric Ferdinand, Bill Burgess and Jimmy Dunne III serving as lead bankers on the deal. Sandler's Burgess had previously advised FirstMerit on its FDIC-assisted purchases of George Washington Savings Bank and Midwest Bank and Trust Co. in 2010.

Goldman Sachs & Co. advised Huntington on the deal after having served as book manager on several of the company capital raises, including three common stock offerings between June 2009 and December 2010.

Keefe Bruyette & Woods Inc., a unit of Stifel Financial Corp., advised Talmer on its merger with Chemical, with James Harasimowicz, Thomas Michaud, Robert Stapleton and Frank Sorrentino serving as lead bankers on the transaction. KBW had a long history with Talmer, advising on the purchase of four subsidiary banks of Capitol Bancorp Ltd. and several capital raises. KBW served as book manager on the company's IPO, and also served as the book manager on an offering of Talmer shares that allowed WL Ross to divest its stake in the company.

Sandler advised Chemical on the transaction, with Mark Biche, Benjamin Schmitt and Jeffrey Gwizdala serving as lead bankers on the deal. KBW had advised Chemical on its last three whole bank transactions and served as book manager on the company's common equity offerings in 2014 and 2013. Sandler served as co-manager on those two offerings.

SNL Image
SNL Image

The largest deal of 2016 also came out of the Midwest and surfaced in late June, when Chicago-based PrivateBancorp Inc. agreed to sell to Canadian Imperial Bank of Commerce for $3.80 billion. That deal remains pending and the seller said in December 2016 that it would delay a shareholder vote on the transaction after several proxy firms said the transaction's pricing made less sense given the post-election rally in bank stock prices. More recently, however, PrivateBancorp maintained that the benefits of the deal "remain compelling."

J.P. Morgan Securities LLC and CIBC World Markets advised the buyer on the transaction, while Goldman served as the exclusive sell-side adviser to PrivateBancorp, and Sandler O'Neill provided a fairness opinion to the seller's board of directors. Sandler's Dunne, Burgess and Schmitt served as lead bankers on the deal. Goldman had served as book manager on a PrivateBancorp common stock offering in the fall of 2012, but Sandler wasn't listed as an adviser on any of the company's capital raises or acquisitions since the crisis. The Private and the FirstMerit deals propelled Dunne and Burgess to the top of the lead banker ranking, based on deal values.

Meanwhile, another Sandler i-banker, Bill Hickey, worked on even more transactions, advising on eight deals, totaling $915.9 million. The largest of those engagements came when Hickey advised Heritage Oaks Bancorp on its $416.4 million sale to Pacific Premier Bancorp Inc. Sandler had previously advised Heritage Oaks when it acquired Mission Community Bancorp in 2014.

KBW's Ashwin Kakani also landed eight deals in 2016, totaling $611.5 million. Kakani primarily worked on a series of mostly smaller transactions in the West, with deal values, where they were disclosed, ranging from as low as $7.2 million to as large as $330.2 million. That engagement came when Kakani joined Joe Gulash and Tom Michaud in advising Irvine, Calif.-based California Republic Bancorp on its sale to Mechanics Bank.

Nick Barbarine, senior managing partner and head of investment banking at Hovde Group, landed eight engagements as well, with the transactions totaling $416.2 million. Each of those advisory roles came advising sellers in Florida, where Barbarine has been one of the most active bankers in recent years. Barbarine advised on 11 transactions in 2015 and 10 of those were sell-side engagements, including nine transactions in Florida.

The future looks brighter for investment bankers focused on the depository space, with the significant rebound in bank stock currencies likely to offer fuel for bank M&A activity. The SNL Bank and Thrift Index currently trades in excess of 180% of tangible book value, well above the median of 151.3% witnessed throughout 2016. That level is also far higher than buyers' offers in 2016, when the median price-to-tangible book value was 144.4%. The rebound in currencies means buyers should have improved capacity to ink transactions.