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Transaction Support

As the bank M&A market revives, it faces a regulatory approval landscape transformed beyond recognition. In the postcrisis era, deals routinely stumble on unresolved compliance issues, unrealistic business plans, or regulators’ lack of faith in management’s ability to execute.

Regulators are more focused than ever on evaluating the soundness and viability of proposed business strategies. Management’s qualifications and ability to deliver are under scrutiny like never before and some banks find themselves unable to execute strategic transactions as a result of unresolved consumer or AML compliance blemishes.

Promontory serves as a trusted adviser that understands the new regulatory and business landscape. We help clients clear the hurdles and reach the closing table. Our services in support of strategic transactions include:

Be fore the Deal
- Strategy viability assessment
- Target and market evaluation
- Deal structure and charter advice
- Regulatory issue resolution
- Risk/control readiness reviews [link to relevant page]
- Due diligence [link to due diligence page]
Getting Regulatory Approval
- Business plan narratives and financial projections
- Capital plans
- Contingency funding plans
- CRA plans
- Stress tests
- Regulatory communications
- Clearing of unexpected stumbling blocks
After the deal
- Post-close due diligence
- Regulatory gap analysis and remediation
- Integrating policies and procedures
Special situations
- Deals between banks and non-banks
- Charter conversion
- Failed bank acquisitions
- Special regulatory exemptions (e.g., 23A, permissible activities, concentrations)

Representative Engagements

A bank-to-bank acquisition stalled after the target failed to address issues with its recent safety and soundness examination. The same exam uncovered issues with its BSA program. The bank’s regulator would not approve the transaction until these issues were satisfactorily addressed. The target engaged Promontory to help them navigate these time-sensitive issues. Working closely with the parties’ counsel and other advisors, Promontory developed a strategy for resolving regulatory issues and promoting real-time conversations with the regulators on emerging or outstanding concerns.
A small, specialized bank sought to acquire a somewhat larger bank in a complementary niche but a different geographic market. Promontory helped the acquirer satisfy the unique concerns of its regulator regarding the business plan, financial resources, and management of the combined institution.
A specialty finance company engaged Promontory to assess its strategic options in light of changing market and regulatory conditions. Based on Promontory’s advice, the company decided to market itself to banks as an acquisition target. Promontory then helped the company develop a bank-suitable business model and revise its operating model to meet bank standards for risk management and internal controls. As the marketing process proceeded, Promontory worked closely with the company’s financial adviser as it identified suitable acquirers and explained the case for the company’s prospects as a bank division.

Transaction Support

Representative Engagements

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