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3 MUST-Do Steps to NEVER Miss Prior to an Acquisition.

by | Bank Acquisitions


I believe everyone goes into an acquisition hopeful.


Unfortunately, for too many banks, the acquisition becomes a profit-sucking, culture destroying, two-year battle of “we versus they.”

In this episode, I’ll show you how to protect yourself from what could be an acquisition nightmare or one that isn’t profitable for years.


If you’re the kind of leader who:


  • Has had several acquisitions already and your team has a “we’ve got this” attitude, you’re going to love knowing how to avoid the disagreeable surprises that often happen to the “we’ve got this” banks.
  • Is somewhat new to acquisitions, but you still know there is a ton to learn, you’ll love knowing there is a predictable success system—one where our clients have had successful acquisitions 100% of the time. By successful, we mean they meet or exceed their profit expectations.
  • Has either not gone down the acquisition path yet or, worse yet, you already are one of the banks reeled for years after an acquisition, you’re going to LOVE this because you can learn that having a successful acquisition is far more than dealing with legal and logistical things—it’s about revenue, people and hanging on to and getting the best customers.


Here are five steps to help you with your acquisition preparedness to take away the potential for the heartache of an acquisition gone badly.


Step 1

Decide if you want to do an acquisition at all. Most acquisitions are made for the wrong reasons. If you need more in deposits or want to grow loans and your organic growth machine isn’t working, you may want to rethink an acquisition as it may simply compound the problem. If your people couldn’t master these strategies and skills before an acquisition, having more people who don’t have the right system and skills can make things worse.

Step 2

Lose the wrong assumptions we’ve all heard hundreds of times at bank CEO conferences. No, you don’t need to lose 30% of the customers acquired. No, you don’t have to have two years of the “we-they” culture war that brings most banks to their knees—many CEOs told me secretly that the two years following their acquisition were the two worst years of their lives. And no, you don’t have to have a mess of people struggling to agree to your ways of doing things IF you can demonstrate that your ways are remarkably effective, and you can immediately win their hearts to your way of doing things.

Step 3

Before you even start putting in offers, make absolutely sure that your franchise systems are impeccable and working to create a top-of-peer performance. How do you hire people? On-board them? How do you identify seven-figure corporate deposit accounts? How do you systematically pick them off from banks, even though they say they love their bank? How do you tie everyone to profit in a way that is not scary or ominous? If you don’t have these and other systems down, an inevitable result from an acquisition is ahead—and you may not like how that looks.

Step 4

Make sure your culture scores are over six on a seven-point scale or get them there first.

Let’s face facts—if you have cultural problems before an acquisition, it is likely to get a whole lot worse very quickly, causing a downward spiral of profit and culture. If you’re considering an acquisition, come to one of my events first and mention when you register that I am offering you a free culture survey using the leading culture assessment tool designed specifically for community banks—normally a $10–20K investment.

Step 5

Don’t overpay. Please, use an outside valuation company that does NOT have a vested interest in acquisitions. In a frothy market, people do crazy things, and I’ve seen reputable CPA firms say, “you have to pay that much, or you’ll lose it” to a bank that, had they purchased, nothing and nobody could have saved them.

A good acquisition happens long before offers are considered—it is about having a franchise system in place and working so that they can quickly fold into a predictable success machine.

Make sure you tune in next time where I’ll show you how to make sure that you prepare your systems—the ones you never think to prepare before an acquisition but the ones that make it profitable.

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