M&A Activity Dominated Banking News in 2024

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2024 was another busy year in the Massachusetts banking sphere.

Mergers and acquisitions dominated the headlines as consolidation continued throughout the industry. Eastern Bank completed its merger with Cambridge Trust, while Berkshire Bank ended the year by announcing its plans to merge with Brookline Bank. Credit unions also continued to seek merger opportunities, as Digital Federal Credit Union merged with First Tech Federal Credit Union, based in California. Pittsfield Bank and Arrha Credit Union also announced a merger, with Pittsfield Bank as the surviving entity.

2024 also saw mutual holding companies take advantage of M&A, with Rollstone and River Run announcing merger plans along with the likes of Cornerstone Bank and PeoplesBank, North Shore Bank and Abington Bank, and Dedham Savings Bank and South Shore Bank.

The past year also saw wealth management take center stage. Eastern’s merger with Cambridge Savings Trust bolstered its wealth management options while others joined in on the action. Rockland Trust’s Investment Management Group surpassed $7 billion in AUA in August after eclipsing $6 billion in 2023. Berkshire Bank and Citizens Bank also built out their private banking teams as wealth management as the institutions look to take a bigger piece of the pie.

Interest rates played a key factor in the industry as banks received some relief from loans on their books. Institutions are also looking ahead to the projected two interest rate cuts in 2025 by building out their business banking teams. David Eidle joined Rockland Trust as the bank looks to expand its commercial and industrial lending business north of Boston. Citizens Bank also launched a new tool to appeal to business banking customers.

Banking regulation was also loosened in 2024 with the end of Chevron deference. The Federal Reserve also backed off of capital requirement plans for large banking institutions.

With a new president coming into office, and a new federal department (Department of Government Efficiency), regulation could continue to open up. The Wall Street Journal has reported that the FDIC, OCC and the Fed could all be restructured under the new administration.

Finally, banks addressed the commercial real estate market to varying degrees. Citizens Bank and M&T Bank announced that they would be scaling back investment in multifamily in recent earnings calls, but other institutions, such as Brookline Bank are looking to scale up in their stead.

There is also the issue of maturity. Yardi Matrix reported in April that about $525 billion in loans covering about 58,500 multifamily properties are set to mature over the next five years in the U.S. While interest rates have dipped slightly, banks balance sheets could be coming under some pressure.

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