Stifel Financial Plans to Acquire Business Bancshares

On May 10, Stifel Financial Corp. SF announced plans to acquire Business Bancshares and its wholly owned subsidiary, The Business Bank of St. Louis, with a view to fortify its presence in the St. Louis region and expand banking capabilities. The deal is expected to close in fourth-quarter 2018.

Shares of Stifel Financial lost 1.6% on next day's trading session, reflecting investors' concerns over undisclosed financial terms of the acquisition.

Founded in 2002, Business Bancshares is a provider of private and business banking products and services. On a consolidated basis with its subsidiaries, the company had about $620 million in assets, $516 million of loans, $536 million of total deposits and $70 million of tangible equity as of Mar 31, 2018, and its non-performing loan ratio was 0.04%.

Per the terms, The Business Bank of St. Louis will operate as a separate subsidiary bank and serve Stifel Financial's Global Wealth Management and Institutional Group clients. Also, senior management and key client relationship managers of The Business Bank of St. Louis will be retained by Stifel Financial.  

Chairman and CEO of Stifel Financial, Ronald J. Kruszewski said, "This acquisition represents another step in the build-out of our banking services in our Global Wealth Management business."

Larry Kirby, CEO and President of the acquired company said, "Stifel's extensive capabilities in wealth management, trust, and investment banking will enhance the products and services that we can offer to our customers."

The company's inorganic growth activities reflect capital strength and efforts to bolster performance. Also, it has diversified revenue sources, which are likely to support its financials. Additionally, it will benefit from improving conditions in the domestic economy.

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