Canadian, European and Asian banks seen targeting US

Canadian, European and eventually Asian banks are likely to feature prominently in mergers and acquisitions in the United States in the coming years, according to John Chrin, head of financial institution M&A at J.P. Morgan.
Domestic bank mergers are not currently allowed in Canada, so financial firms there need to look south to the US for deals.
"Over the next decade, foreign institutions should play an increasingly active role in consolidation in the United States," Chrin said in a recent interview.
"Canadians, Europeans, and I venture to say ... it is not going to be long before we see Japanese institutions start re-evaluating the United States and one might argue even some of the Korean institutions."
Canada's major banks include Toronto-Dominion Bank, Royal Bank of Canada, Bank of Montreal, Bank of Nova Scotia and Canadian Imperial Bank of Commerce.
"The Canadian banks have muscle and size and as important, they also have a good trading multiple in terms of their price to earnings ratio," said Chrin.
"They trade at multiples that are at or above their US competitors, which is different from the Europeans who typically trade at or below the US entities. So it gives them a little bit of an advantage."
Canadian-owned banks already have a substantial presence in the United States and have continued buying in the past year.
TD Banknorth Inc, majority-owned by TD Bank Financial Group, parent of Toronto-Dominion Bank, last month agreed to buy Interchange Financial Services Corp for $480.6 million in cash, its second acquisition in northern New Jersey in the past year.
Last July, TD Banknorth announced the purchase of Hudson United Bancorp, one of New Jersey's largest banks, for about $1.9 billion.
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The largest US banks will continue to look overseas for opportunities, but Chrin expects the United States to experience more inward bank merger activity than outward.
Other analysts agree, saying big European banks like ABN AMRO, BNP Paribas, HSBC, Royal Bank of Scotland and Banco Santander Central Hispano that already have operations in the United States, may seek expansion.
In Europe, social and political hurdles to cross-border mergers are gradually coming down, but European firms may still have the edge in any deals.