Banks Bought Fewer Agencies In 2003, But Paid More
Banks bought fewer insurance agencies in 2003 but paid more on average, according to Alexander Sedgwick, mergers and acquisitions manager for the research firm, SNL Securities, in Charlottesville, Va.
There have been 56 acquisitions of agencies by banks thus far in 2003, compared to 74 last year. Banks were involved in 33% of agency acquisitions in 2003, Sedgwick says, vs. 38% last year, a difference he does not consider significant.
“The intriguing part [of bank agency acquisitions] is that deal values increased to $425 million, compared to only $133 million last year,” says Sedgwick.
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Since most deal values are not publicly disclosed, those numbers represent only a fraction of the total dollar value of bank agency acquisitions, he notes.
Sedgwick points out, too, that 2003s deal values were largely spiked by a single bank agency acquisition, announced in November 2003 by BB&T Insurance Services, a bank brokerage in Raleigh, N.C. BB&T said it plans to buy McGriff, Seibels & Williamson of Birmingham, Ala., for $354 million in cash and stock.