Banks with insurance businesses had a choice to make in 2023: hang onto those units and keep reeling in a steady stream of fee income, or sell them for a lot of money.
Several banks chose the latter course,
Competition and the ability to scale up in insurance, or not, also played a role, said Mark Crites, a partner at Reagan Consulting, a firm that works with insurance agents, brokers and financial institutions.
"There are lots of big players investing a lot to outcompete those who are not," Crites told American Banker earlier this fall. "So banks have to make a decision: Do I invest heavily in resources on the insurance side, or do I invest heavily in my core businesses?"
Through October, seven U.S. banks agreed to sell their insurance agencies, topping the number of banks that made deals to buy agencies by two, according to data compiled by S&P Global Market Intelligence. It was the
The S&P data doesn't include sales or acquisitions that took place later in the year, including Evans Bancorp's divestiture of its insurance agency to Gallagher for $40 million.
It's a seller's market, which has led to buyers paying significant premiums, Patrick Gallagher, Gallagher's chairman and CEO, said in October.
"We've had incredible success with our friends at M&T. We're very excited about Eastern and Cadence," Gallagher said on the conference call. "Frankly, if there's other banks that are looking in that direction, we're a very good place to look."
Here is a rundown on several banks that sold all or some of their insurance operations this year.