Exit and Growth Strategies for Middle Market Businesses

M&A Quarterly News In The Financial Services Industry Sector

By David Sinyard | Feb 14, 2020

The report below gives a good overview of the first quarter M&A activity in the Financial Services Industry Sector. M&A activity for North American based target companies in the Financial Services sector for Q3 2019 included 224 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions in the sector was announced in October when Redwood Trust, Inc. acquired CoreVest American Finance Lender, LLC from Fortress Investment Group LLC, ultimately owned by SoftBank Group Corp, for US$492 million with an undisclosed amount in cash and stock, subject to adjustments. CoreVest American Finance Lender is located in Irvine, California and provides loans to residential real estate investors.

Industry Indicators

  • US corporate profits, an indicator of corporate demand for financial planning and investment advising, fell 0.8% in the third quarter of 2019 compared to the same period in 2018.
  • The bank prime loan rate, a tool for financial planners and investment advisers was 4.75% as of the week of December 16, 2019, down from a rate of 5.25% the same week in 2018.
  • US personal income, which is a driver for financial planning and investment services, rose 4.4% in October 2019 compared to the same month in 2018.
  • Total US revenue for other financial investment activities, which includes financial planners and investment advisors, rose 4.1% in the third quarter of 2019 compared to the previous year.

Posted by David Sinyard.

Read the Entire Financial Services 1st Quarter Newsletter Here

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