Mr. Leibundgut has a long history in the strategic planning and due diligence that accompanies a contemplated financial institution acquisition or merger. This experience spans both traditional transactions and OCC/FDIC assisted purchases. Critical to the successful consummation of any merger or acquisition, public or private, assisted or non, is ensuring the thoroughness and breadth of the initial planning, preparation and execution of a plan of phased due diligence sufficient to properly price the deal so as to avoid unanticipated post-acquisition losses. Failure to properly plan and conduct in-depth due diligence is the single largest reason acquiring banks and institutions sustain significant unexpected losses in the merger and acquisition arena. These transactions require the allocation of sufficient time, resources and appropriate niche areas of expertise at all stages (from planning through the approval processes): Meticulous attention to detail is the rule. We recommend a phased approach to any acquisition or merger but are always prepared to mobilize quickly to meet tight initial time frames. When retained to represent a Client in a proposed merger or acquisition, an initial strategic plan for the due diligence focused on the Target’s lending process and asset quality is developed.
- The Target’s key planning documents (strategic plan, business plan, risk appetite scenario, budget and lending policies, procedures and processes) are evaluated to determine if they are in alignment with risk management necessary to protect their assets.
- Pricing is negotiated to comport with each Client’s goals and expectations.
- Individual credits are reviewed (often in two phases to achieve sufficient penetration) to determine the quality of the underwriting, documentation and account management. The transactional review will determine if the Target’s risk rating practices provide a proper picture of the risk in the commercial and retail loan portfolios. Extraordinary risks that have not been properly identified and/or reflected in the Allowance for Loan and Lease Loss (“ALLL”) reserves are identified and quantified.
- The quality of the lending, internal control and independent oversight reflected in the credit portfolios, quality and integrity of management and staff as well as the overall credit culture existing within the Target is evaluated.
While the scope of each engagement and the deliverables required are mutually determined with each Client, these transactions follow a well-developed pattern of strategic due diligence planning, preparation, negotiation and execution.
PD&J CAN HELP A CLIENT PLAN AND EXECUTE AN ACQUISITION OR MERGER. STRATEGIC OBJECTIVES MUST BE COORDINATED WITH THE LEGAL, INVESTMENT BANKING, ACCOUNTING AND DUE DILIGENCE SERVICES REQUIRED IN ALL SUCH TRANSACTIONS. SERVICES MUST BE PERFORMED IN A TIMELY, EFFICIENT AND THOROUGH MANNER INORDER TO PROTECT AGAINST UNANTICIPATED LOSSES.