The volume of merger and acquisition activity has been relatively flat in 2023, but that could soon change. Through the first half of the year, 74 credit union transactions and 61 bank deals were announced. If those levels continue for the remainder of 2023, we'll be looking at approximately 150 credit union M&A transactions and 120 bank deals on an annualized basis. The double bar chart illustrates a snapshot of overall industry consolidation through mid-year 2023.

Conversations Continue, Timeline Expands

There are several trends keeping some financial institutions in the exploratory stage for now. However, conversations are happening across the industry even if immediate action isn't always taken. What's driving this measured approach to mergers? Uncertainty in the economic and regulatory environment, more competition from non-traditional financial services providers, as well as the increasing size and complexity of transactions are causing some boards and executives to proceed with caution. In addition, mergers take time, particularly in the credit union industry, as trust and rapport are built through both initial conversations and ongoing discussions.