| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
 That's right. Citigroup Inc. is in talks to buy Chevy Chase Bank FSB, but it is not alone in its interest for the troubled Bethesda, Md.-based regional bank, according to The Wall Street Journal. But, does it matter? And will it help the troubled giant?
Felix Salmon over at Portfolio says no:
The problem is that Vikram Pandit gave himself altogether too much time to get smaller, and then decided his best chance at salvation was to get bigger -- by buying Wachovia. Now, it's too late: the die has been cast. Will Citi buy Chevy Chase Bank? It really doesn't make any difference either way.True, Chevy Chase Bank is no Wachovia Corp., but it is a regional player that overlaps with Citigroup's branches, and it will give Citigroup a few more deposits. Chevy Chase Bank operates more than 280 branches in the mid-Atlantic region with $14.9 billion in assets and $11.4 billion in deposits. Besides having checking and saving accounts, the bank also carries loans for homes, cars and commercial properties. It's an interesting choice and a smaller choice than many analysts would have guessed. However, since Chevy Chase Bank was badly banged up by the real estate market, the bank could be had for a steal. Over the past year, Chevy Chase did what Citi and many other banks were doing, which is divesting assets. The bank put the Lowes Island golf club on the block, cut back hours at branches, gave up its in-store banking relationship with Giant Food to PNC Financial Services, and sold off some assets and deposits to Hampton Roads Bankshares Inc. However, privately held Chevy Chase is too small to put Citigroup back on the map as being the largest bank in the U.S., so if Citigroup doesn't win out in the bidding for Chevy Chase it probably won't be a huge upset like Wachovia was. However, the potential deal has prompted Google and Yahoo! message board chatter running from the serious to the absurd:
Do you have any thoughts on rumors that Citigroup could acquire Chevy Chase? Leave your comment below. - Maria Woehr See related speculation about Citi buying RBS' U.S. bank Citizens from Dealscape CategoriesComments
From: Anonymous,
I wouldn't be surprised if this situation were reversed. Do not assume that Citi is purchasing Chevy Chase Bank. Chevy Chase may see a prime opportunity. Chevy Chase would likely sell at a premium and Citi can't afford it. Keep in mind that Chevy Chase is a privately held regional bank that has grown it's market share from "Other Bank" category 10 years ago to the 5th largest market share in the DC Metro area, which may be one of the most "economy-proff" in the country. The only banks ahead of it are the largest corporate banks in the country.
Posted on:
November 19, 2008 5:07 PM
 Deal Video
    Community
 Elsewhere on The Deal.comDealwatch
The Deal MagazineCorporate Dealmaker
The Deal VideoCategories
Blog roll
Archives
| |||||||||||||||||||||||||
|
|
|
|
|
©Copyright 2009, The Deal, LLC. All rights reserved. Please send all technical questions, comments or concerns to the Webmaster.
This is not true. Chevy Chase is far from trouble. It's privately owned and very profitable.