If interested in Buying a Small Bank ( State, National or Thrift in The USA).
Consultants to Financial and Private equity industry.
CREDIT CAPITAL FUNDING
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Credit Capital Funding
1. Putting an offer sheet with basic terms and conditions for the due diligence.
2. If the offer is accepted hiring a good law firm and accounting firm for the preparation of
1. Definitive Agreement.
2. Doing due diligence.
3. During the due diligence process, following questions should be put in picture.
A copy of audited financial statements for the past three years.
• Does the bank own or lease the space that it occupies? If it leases the space, what is the remaining term?
• Regarding the loan on the book, provide a breakdown by type, rates, and maturity.
• The investment the bank owns. The breakdown by type, rates, and maturity.
• The deposit on the book. The breakdown by type, rates, and maturity.
• A brief description of the customers.
• Who is the present management and how the bank board is organized.
• A list of shareholders.
• Analysis of CAMELS- Capital, Asset quality, Management, Earning, Liquidity and sensitivity to market risk.
4. After the acceptance of the Definitive Agreement buyer places money in escrow.
5. Buyers seek regulatory approval within 5-10 days after the execution of the Definitive Agreement.
6. Seller seeks its shareholders approval to the transaction as soon as the Definitive Agreement is executed and the deposit of funds is received.
7. Buyer has to in the mean time get the regulatory approval.
8. Closing take place and if possible making sure that present management stays there for two to three months.