Community Bank and Financing Institution Advisory Services

We at FOCUS are firmly committed to the success of American entrepreneurs.  Having spent decades working with growing companies we know that Community Banks and specialty financing companies are critical to their success.  Today Community Banks are under fire.  You are faced with the need to:

  • Increase your capital to meet regulatory demands and support loan growth
  • Increase profits in a zero interest rate environment
  • Address rapid technological change affecting the nature of banking itself
  • Plan for industry consolidation and come out a winner

We have formed the FOCUS Community Banking and Financing Institutions Team to assist you in navigating this minefield.  Collectively we have years of operating experience in community banking as CEOs an CCOs of various banks and have led numerous turnarounds to the point of a successful exit.  Team members have built a de novo institution from scratch and participated in numerous M&A transactions.  We have substantial experience in capital raising, asset based lending and board experience with community banks.  We are committed to your success and the long-term prosperity of the Community Banking Industry.

As your advisor we will assist you in developing a realistic, market based strategic plan to address:

  • Valuation analysis to include both what is and what can be in the future with proper planning and good execution.  We have access to comprehensive industry databases that enable us to compare your institution to its peers around the country in terms of trading multiples, comparable transactions and discounted cash flow analysis.  We also take into account the structure and quality of the loan portfolio as well as location, deposit strength, name recognition, local market competition and other factors that impact intangible values. 

To these analytical activities we apply the judgment gained through many years experience in both the banking and securities industries to determine real world values that provide you and your board with actionable intelligence.  We provide this information in a format that can be read and understood by intelligent business people, not just financial analysts.  Finally we provide tangible suggestions as to concrete actions you can take to increase valuation over time.

  • Capitalization alternatives include:
    • Community-based private placements
    • Institutional equity
    • Public stock offerings
    • EB-5 Visa applicants and other non-traditional capital sources
  • Business line acquisitions and dispositions
  • Portfolio acquisitions and dispositions
  • M&A planning to include both acquisition growth strategies and value optimization in the event of eventual sale

While a plan is critical, execution is where there rubber meets the road.  We stand ready to act as your advisor on specific M&A and capital raising transactions.  We lay no claim to magic and we are well aware that the current capital market for community bank equity is very difficult with no promise that it will become easy in the near future.  Our commitment is that we will be working to identify creative new sources of bank capital and to provide you with the best alternatives that the market makes available.

The FOCUS Approach

As a bank CEO I was often frustrated when I developed a relationship with a great senior level investment banker, only to learn that I was to be dealing with wet behind the ears B-School grads when the project started.  FOCUS is different.  While we have great analytical backup, all of our services are led by senior professionals with decades of experience. FOCUS staffs each assignment with two Managing Directors and/or Senior Advisors to assure that you have access to a seasoned professional from our team at every stage of the process.

As your advisor, FOCUS will fully interview your management team and board, review your strategic plans, operating plans, and near and long term financial forecasts. We will analyze your balance sheet including loan assets and deposits, operating statements, risk profile and all market trends and considerations.  We will know your institution in depth before advising you on a strategic course.

Once a strategic course is set, your FOCUS advisor will identify and analyze a range of appropriate programs that will enhance shareholder value.  These programs can include asset sales, capital formation, and mergers and acquisitions. FOCUS will also advise our clients on terms and structure of private placements, convertible preferred stock, and common stock as part of growth initiatives and strategic transactions.

Community Bank M&A and Capital Raising Experience

With our industry knowledge and experience as both principal and investment bankers in numerous M&A and financing transactions for community banks as well as non-bank finance companies, we know how to present your institution in the most positive light.  Community Banks are not like large banks and we understand that.  Franchise value is based on many components and includes the depth of knowledge the management team has of its market and clients.  Telling the “story” well can make all the difference in creating a successful transaction.  Knowing how that story was made is understood even greater due to the many years of operational experience.

Middle Market Fairness Opinions

In this litigious world arranging the best transaction for your bank may not be enough to protect you and your board.  FOCUS provides fairness opinions for multiple kinds of transactions. A fairness opinion is the professional opinion of an investment bank regarding the fairness of a price offering in a merger, takeover, and divestiture or asset sale. FOCUS delivers fairness opinions in both public and private transactions.

Before rendering such an opinion, we examine price, terms, legality and potential conflicts relative to similar deals.  Fairness opinions help protect the Board of Directors from outside legal “second guessing” their transaction decision-making. Courts have frequently ruled that a properly researched Fairness Opinion is sufficient to support a ruling that the Board has fulfilled its fiduciary duty to the shareholders

Let’s Talk

This summary is far from comprehensive.  The best way to determine how we can help you and your institution is to set up a call or a meeting.  We talk your language and are anxious to learn more about your opportunities and needs.  The first meeting is on us.  At worst we’ll make a new friend and at best we’ll be establishing a long-term trust relationship that will enable us to help you and your bank move to the next level of success.

Carl Raggio
FOCUS LLC Community Banking and Financing Institutions Team