Banker Meeting Has Markings of Swap Meet : New Yorkers to Confer With California Group
More than 200 California and New York bankers will review California’s interstate banking legislation in a private conference Thursday that has all the markings of bank swap meet.
Most of those attending will be the chairmen and chief executive officers of banks that may want to sell out--or avoid a sellout--to a big conglomerate.
Leading the bank treasure hunt for about 40 corporate buyers--to be identified by the green dots on their name tags--will be acquisition officers at such giants as Citicorp and Chase Manhattan Corp. in New York and Security Pacific Corp. in Los Angeles.
“For the last five years, everyone has speculated about what Eastern bankers are going to do when interstate banking becomes law,” said Edward Carpenter, a Newport Beach financial institutions consultant. “Now they’re going to hear it from the horse’s mouth.”
Carpenter called it the first meeting of Eastern and Western bankers to discuss interstate banking. Speakers are expected to discuss what buyers are looking for, how sellers can position themselves for takeovers, what role investment bankers will play and how local banks can band together to avoid takeovers.
After a general session Thursday, potential buyers and sellers can meet individually Friday to “exchange information,” said John Todd, a partner in the Orange County office of the Deloitte, Haskins & Sells accounting firm. Deloitte Haskins is sponsoring the event, and its Orange County office has organized the affair at the Los Angeles Airport Hilton Hotel.
The individual discussions could range from the present and future status of potential selling companies to signed deals, said Todd.
California’s two-bill interstate banking package, passed by the Legislature on Aug. 29, is awaiting Gov. George Deukmejian’s signature to become law. An estimated 38 states already have interstate banking laws.
The measures would allow banks and other financial institutions in 11 Western states to enter California next July as long as those states allow California institutions to operate in their states. In 1991, banks outside the West would become eligible to move into California on the condition that other states pass reciprocal laws.
The obvious vehicle to use to enter California, Carpenter said, is to purchase a well-run existing bank that fills the purchaser’s other needs, such as market position or branch locations.
“Many shareholders of banks, in the backs of their minds at least, are certainly interested in selling,” said Todd, who heads his firm’s banking practice for Southern California. Since the Arizona interstate banking law passed earlier this year, Arizona bank stocks have sold at 2.76 times their book value. In recent years those stocks typically sold more in the range of 1 to 1.5 times their book value, Todd said.
The Arizona law is not effective until Oct. 1, and five pending deals cannot be consummated until then.
Among the speakers at Thursday’s conference will be Latif N. Sayani, senior vice president for mergers and acquisitions at Citicorp; Frank Partell, senior vice president for national strategy and execution at Chase Manhattan Bank, and Gregory J. Bjorndahl, senior vice president for acquisitions at Security Pacific National Bank. The luncheon speaker will be state Sen. Rose Ann Vuich (D-Dinuba), a co-author of the bill.
