Lynn Johannson, Advisor, Sustainability and ESG
January 4th, 2024
Lynn Johannson, President of E2 Management Corporation and Catalyst for THE Collaboration
In a care[...]
As Valuations Plunge, Fintechs Become Acquisition Targets for U.S. Banks
Reuters | Saeed Azhar and David French | Nov 18, 2022
Financial technology companies are increasingly becoming acquisition targets for traditional U.S. banks as rising interest rates and falling valuations crimp their expansion.
- The valuations of listed financial technology firms have plunged 70% in 2022, analysts at Jefferies Group said in a note last week. In the same period, the valuations of banks in the S&P 500 are down 33%, while valuations for the S&P 500 (.SPX) are down 23%, according to data from Refinitiv IBES.
- M&A and Partnerships: The decline presents an opportunity for Main Street banks to buy companies and beef up their technology for digital banking, online payments and other financial services and diversify beyond lending.
- Fintech transactions may be easier to clinch compared with bank mergers, which have been delayed by scrutiny from regulators.
- "Management teams and boards have redirected some of their focus to non-bank opportunities," said Brennin Kroog, a managing director in the financial institutions group at Lazard. Those include digital tools for wealth or treasury management and point-of-sale financing.
Embedded Finance: EmFi Fueled by Cloud-based Infrastructure | KPMG Fintech Pulse H1 2022
- Dry: "With valuations coming down, and the IPO and SPAC markets all but dried up at the moment, there's certainly a lot more room for acquisitions by traditional banks into fintech," said Dan Goerlich, a partner at PwC who focuses on financial deals.
- Cutting costs: Startup founders could come under more pressure to do deals as it gets more expensive to run their companies. Investors have become intensely focused on rising funding costs.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
 |  |  |
Support NCFA by Following us on Twitter!Follow @NCFACanada  |
Related Posts
OMNI college adds FundRazr as Revolutionary New Funding Option- Ron Suber’s Guide to Improve the Crowdfunding Industry
- Where to Find Startup Loans in 2018
- Coinsquare’s CEO Is Focused On Expanding Services While Gaining Public Trust
- For crowdfunding to succeed, we must level the playing field
- Aussie Adventure: Navigating Work and Play on a Working Holiday in Australia
Leave a Reply