Insights on financial services M&A June 2020

Explore topics impacting financial services and banking M&A along with a current overview of financial services valuation trends.



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Differentiated diligence after COVID-19

As dealmaking resumes, private equity and other buyers have an opportunity to earn outsized returns—as was the case on well-timed transactions after the 2008-09 recession. But finding value will require differentiated diligence. As in the last recession, there will be many smaller, messier deals—distressed assets and carve-outs. Finding “diamonds in the rough” will be even harder this time because of the economic disruption caused by the COVID-19 lockdown, which makes it exceedingly difficult to find true value in a sea of noisy data.

This makes the use of advanced diligence techniques essential. In this paper, we share six techniques that will need to be emphasized even more in the post COVID-19 deal world. These techniques help dealmakers gather intelligence that routine diligence can’t provide by seeing beyond reported numbers and expert insights to discover true sources of value (and barriers to value capture). Players that use differentiated diligence after COVID-19 can hope to match or exceed the returns that top players achieved after the last recession.

Read full article here

Price / last-12-months EPS

 

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Source: S&P Global Market Intelligence website (June 2020).
 

Price/Book

 

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Note: Insurance brokers and investment advisors are excluded from the chart.
Source: S&P Global Market Intelligence website (June 2020).
 

Return on average shareholders' equity (%)

 

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Note: Insurance brokers are excluded from the chart.
Source: S&P Global Market Intelligence website (June 2020).

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KPMG Deal Advisory distributes a wide selection of thought leadership that highlights the latest M&A issues and trends.

KPMG Deal Advisory distributes a wide selection of thought leadership that highlights the latest M&A issues and trends.

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Timothy Johnson

Timothy Johnson

Financial Services Industry Leader, Deal Advisory, KPMG US

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Alexander Alden

Managing Director, Corporate Finance, KPMG US

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Joe Schneider

Managing Director, KPMG Corporate Finance LLC

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Jonathan Froelich

Partner, Deal Advisory, KPMG US

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Miguel Sagarna

Partner, Deal Advisory, KPMG US

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Ram Menon

Ram Menon

Partner, Global Head of Insurance, Advisory, KPMG US

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James Brannan

James Brannan

Advisory Managing Director, Financial Due Diligence, KPMG US

+1 212-954-1987