Pub. 3 2024 Issue 2

An Overview of the Local Banking Landscape First Quarter 2024 Contents: • Colorado M&A Activity • Deal Pricing • Recent Transactions • Geographic Comparison • Public Stock Valuations Colorado Bank M&A Briefing Colorado Bank M&A Landscape Brian Palmer President 720.797.9233 bpalmer@olsenpalmer.com Washington, DC Birmingham • Chicago Dallas • Denver Kansas City Bank M&A was sluggish in 2023 as only 98 whole-bank transactions were announced nationally, 40% lower than in 2022 and, in fact, one of the lowest annual tallies on record. In Colorado, 2 whole-bank M&A transactions were announced including Olsen Palmer client Denver Bankshares, Inc./Bank of Denver executing a definitive merger agreement with MidWestOne Financial Group, Inc. While the languid pace of dealmaking can be attributed to a variety of factors – inflation, economic uncertainty, ballooning funding costs, headline-grabbing bank failures, a precipitous decline in bank stocks, etc. – one factor was, by far, the biggest culprit: the sharpest increase in the federal funds rate in more than 40 years and the ripple effects thereof, particularly the advent of bond losses and the resulting bid-ask spread. All that said, 2023 is likely to prove less of an extinguishment of consolidation activity and more of a deferral of dealmaking into future periods. Looking ahead, the stage is set for a period of elevated M&A activity ahead as the tectonic forces driving consolidation in recent years still hold and, in fact, have become appreciably more stout. Accordingly, a re-calibration of your bank’s strategic plans is recommended whether as a potential seller, a would-be acquirer, a prospective merger partner, or none of the above. Especially for those considering a sale at some point, an informed discussion of market conditions and optimal timing would prove advantageous; a bottleneck of sellers appears to be building, a surge that would be beneficial to get ahead of, if and as feasible. INDEPENDENT REPORT | 25

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