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Stifel Financial (SF) Acquires Business Bancshares & Unit

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Recently, Stifel Financial Corp. (SF - Free Report) completed the acquisition of Business Bancshares and its wholly owned subsidiary, The Business Bank of St. Louis. The deal was announced in May with a view to fortify its presence in the St. Louis region and expand banking capabilities. Notably, on closure of the deal, The Business Bank of St. Louis has been renamed “Stifel Bank.”

Founded in 2002, Business Bancshares is a provider of private and business banking products and services. On a consolidated basis with its subsidiaries, the company had about $607 million in assets, $500 million of loans, $522 million of total deposits as of Jun 30, 2018, and its non-performing loan ratio was 0.04%.

“We are excited to welcome the team from Business Bancshares to Stifel, as this acquisition further enhances the growing capabilities of Stifel’s bank and wealth management businesses,” said Ronald J. Kruszewski, chairman and CEO of Stifel.  

“Not only is this acquisition a good cultural fit for us, but it enables Stifel to expand into attractive products that include treasury services and payroll processing as well as increase our lending capabilities. Additionally, Business Bancshares will operate as a separate subsidiary of our bank holding company, which will increase the FDIC coverage of deposits held at Stifel’s affiliated banks,” he further added.

Terms of the Deal

Per the terms, The Business Bank of St. Louis will operate as a separate subsidiary bank and serve Stifel Financial’s Global Wealth Management and Institutional Group clients. Also, senior management and key client relationship managers of The Business Bank of St. Louis will be retained by Stifel Financial.

Notably, 0.705 shares of Stifel Financial will be exchanged for Business Bancshares' per share.  

Conclusion

Stifel Financial’s inorganic growth activities reflect capital strength and efforts to bolster performance. Also, it has diversified revenue sources, which are likely to support the bank’s financials. Additionally, the company will benefit from improving conditions in the domestic economy.

Over the past year, shares of Stifel have gained 20.9%, outperforming the industry’s rally of 17.5%. The stock currently carries a Zacks Rank #2 (Buy).



Other Stocks to Consider

Comerica Incorporated (CMA - Free Report) has been witnessing upward estimate revisions for the past 60 days. Also, the company’s shares have surged nearly 46% in the past year. It sports a Zacks Rank of 1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

M&T Bank Corporation (MTB - Free Report) has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has jumped more than 23% in a year’s time. It currently carries a Zacks Rank #2.

Texas Capital Bancshares, Inc. (TCBI - Free Report) has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has rallied more than 24% over the past year. It currently carries a Zacks Rank of 2.

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