Pub. 9 2020 Issue 2

March/April 2020 23 l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s Safer, More Efficient Management of the Appraisal Process MOBILE APPRAISAL SOLUTIONS • Safe Mobile Appraisal Solutions • Practice Social Distancing • Keep the Lender Pipeline Moving • Appraisal Report Delivered to Lender • Exterior Inspection by Appraisers – Homeowners Take Interior Photos Use Verisite’s Mobile Inspection Tools on purchase and refi loans and sub-loan products, such as home equity loans, disaster relief inspections, new construction progress evaluations, and portfolio reviews. Confirm completed insurance repairs and validate internal and external property conditions. Contact Lee Volmer | (402)714-0856 lee@creditinfosystems.com While MOEs will likely remain challenging due primarily to the social issues involved, they continue to present potential opportunities for banks of all sizes. In the right situations, MOEs may help address some of the challenges many community banks face, including aging leadership, slow or no growth markets, lack of scale, inefficiencies and technological shortfalls. However, the number and ultimate success of bank MOEs going forward will largely depend on the vision and flexibility of each bank’s ownership, board and executive team. If they see the possibilities of two organizations coming together to equal something more and have the flexibility to pursue an MOE, we may continue to see more of these transactions in the future. Another trend that gained further prominence in 2019 was the acquisition of banks by credit unions (CU). CUs announced 16 transactions for banks in 2019 — almost twice the number of transactions in 2018. In addition, while most CU-bank acquisitions had historically involved smaller community banks, both Community Bank & Trust of Florida and Apollo Bank had more than $700 million in assets at the time of their announced acquisitions by CUs. While CUs acquiring banks will likely make up a relatively small portion of the total number of transactions in any given year, from a competitive standpoint, these acquisitions have raised concerns among bankers. However, for banks that have decided to sell, CUs may present an attractive financial package in some markets. As we look to the remainder of the year ahead, from COVID- 19’s effect and political uncertainty to economic turmoil and other events both expected and unknown, 2020 promises to be a year of challenges for the banking industry. This applies to potential buyers and sellers, as well as banks that choose to eschew transactions to focus on organic growth. When uncertainty and turmoil arise, fate often favors the resourceful, bold and foresighted banks that are committed to helping their customers and communities flourish — even in uncertain times. This article is for general information purposes only and is not to be considered as legal advice. This information was written by qualified, experienced BKD professionals, but applying this information to your particular situation requires careful consideration of your specific facts and circumstances. Consult your BKD advisor or legal counsel before acting on any matter covered in this update. Article reprinted with permission from BKD CPAs & Advisors, bkd.com. All rights reserved. Wyatt Jenkins is a member of the National BKD Capital Advisors Group. Wyatt advises financial institutions on mergers, acquisitions, sales and divestitures, recapitalizations, buyouts and succession planning.