Banks often turn to mergers and acquisitions to increase earnings and meet growth objectives. An M&A advisory firm can help banks navigate these complex transactions and provide ongoing guidance to help clients successfully seal the deal.
The M&A market took a hit in 2020 primarily due to the COVID-19 pandemic and questions surrounding the United States presidential election. However, deal activity quickly rebounded and deal value is likely to continue increasing throughout 2021. An M&A advisory firm that specializes in integration can help banks take advantage of new opportunities in the upcoming months with minimal disruption to their operations.
Aid in Selection of Technology & Software
Technology plays an integral part in a bank’s daily processes and performance. An M&A advisory can help a client evaluate both banks’ technology and determine what will best meet the current and future needs of the business.
When choosing new technology, a bank should consider who will be impacted by migrating systems and how best to minimize disruptions to customers. An M&A advisory firm focused on integration can also help develop a plan for network consolidation, handle telecommunications networks design, determine how best to migrate data and servers, and make sure the acquiring entity’s infrastructure is able to effectively support the larger organization.
Conduct Proper Due Diligence
Conducting due diligence is a critical component of the M&A process. Due diligence involves the investigation and verification or audit of a potential investment opportunity or deal to confirm financial information and relevant facts. Due diligence can also help identify potential defects in an investment opportunity or deal, allowing buyers to avoid a bad business transaction.
Transactions that undergo due diligence generally have a higher rate of success. An M&A advisory firm can assist a bank by conducting operating and technology due diligence.
Recommend Improvements to Existing Processes
Not only can an M&A advisory firm help banks recognize issues that need to be addressed within the business, but they can also recommend improvements for existing processes. Many businesses require some preparatory work before going forward with a merger or acquisition.
An M&A advisory firm will carefully analyze a client’s existing processes to determine where problems exist, such as a lack of middle management, poor strategic planning and foresight, low repeat business or a lack of adequate financial controls or reporting. Although not all problems will be deal breakers, they can have an impact on the deal and should be addressed early on in the process.
Provide Support During the Transaction
M&A advisory firms generally provide their clients with ongoing support throughout the transaction. The decision to go through the merger or acquisition process can be a stressful and emotional time for bank leaders. M&A advisors who have worked with many clients understand the challenges that these transactions present to banks. Working with an experienced M&A advisory firm can provide bank leaders with support throughout each stage of the process. They can give clients peace of mind and quickly answer any questions that clients may have about the deal.
Implement New Strategies After Integration
The benefits that an M&A advisory firm provides to clients continue long after integration. M&A advisors can help a business implement new strategies that aid in streamlined management and growth of the company. An M&A advisory firm may assist with hiring processes for both short-term and long-term needs, employee retention, technology, tracking employee performance and similar aspects of a business. No set time frame dictates how long post-deal integration should last and many banks can benefit from ongoing support and guidance.
Speak with the M&A Advisory Specialists at Hartman
The M&A process can be highly complex and many factors should be taken into consideration before a deal can be completed. Working with an M&A advisory firm is one of the best ways to simplify the transaction and help ensure a satisfactory result. To learn more about how an M&A advisory firm can assist banks in 2021 or to speak with an M&A advisory specialist, contact Hartman Executive Advisors today.