Bank mergers advance amid capital strains and regulatory proposals

FDIC orders Old Glory Bank to address its capital shortfall. Its Tier 1 leverage ratio was 2.69% as of June 30, and the bank did not respond to an earlier capital warning. The FDIC called it severely undercapitalized; regulators can require new capital, a sale or liquidation.

California regulators closed Nano Banc. The FDIC was appointed receiver for the $736 million-asset bank. Sunwest Bank agreed to assume substantially all deposits and purchase approximately $476 million of assets; the FDIC preliminarily estimates a $114 million Deposit Insurance Fund cost, subject to change as retained assets are sold.

BCB Bancorp expects a pretax loss from problem-loan sales. BCB Community Bank reported sales of approximately $205.3 million in problem-loan portfolios to six purchasers, with five transactions closed and an estimated $43.3 million pretax loss. BCB Bancorp completed a 12.65 million-share offering for approximately $92.4 million in net proceeds and expects a third-quarter loss of $126.2 million to $136.1 million.

EverBank and WaFd agreed to a reverse merger. The $3.9 billion transaction is expected to close in the first quarter of 2027 and would create a lender with $75 billion in assets. EverBank investors would own approximately 59.2% of the combined company; management projects $135 million in cost savings and 29% earnings-per-share accretion in 2027.

Arrow Financial closed its Adirondack acquisition; Colony Bankcorp's First Reliance merger awaits shareholder votes. Each Adirondack share converted into Arrow stock and $18.72 in cash. Arrow's September filing supplied pro forma combined financial information with merger adjustments. Colony secured regulatory approvals for its $163 million stock acquisition of First Reliance, with closing expected November 1 if shareholders approve it. The deal would expand the Georgia-based buyer into South Carolina.

Bank7 and Gateway agreed to separate acquisitions. Bank7's September filing sets consideration for Century Financial Services at $70 million in cash plus 1,232,657 Bank7 shares. An earlier report described an $89 million net-cash winning bid for a 71% controlling stake. Century Bank would merge into Bank7 after closing, expected in the fourth quarter pending regulatory approvals. Separately, Gateway agreed to buy First Western Mortgage and its $502 million-asset Colonial Savings unit in the first quarter at an undisclosed price.

Truist agreed to sell $5.5 billion of auto loans. The Regional Acceptance loan sale is expected to generate $5.2 billion in net proceeds and supports Truist's exit from near-prime auto lending. Truist had stopped originating marine and recreational vehicle loans and reduced other indirect-auto originations; management said the broader shift would lower near-term net interest income but improve longer-run profitability and efficiency.

BMO maintains its 12% U.S. return-on-equity target. The bank expects to reach that target by October 31, 2027, following lower-return loan-portfolio sales and the divestiture of 138 branches. Management's stated path depends on higher client balances, fee-income growth, cost savings and normalized credit-loss provisions.

The Fed proposed rules for payment stablecoin issuers it supervises. Its September 24 GENIUS Act proposals would set reserve-backing, capital and risk-management requirements for supervised issuers and create an application process for state member banks seeking stablecoin-issuing subsidiaries. The rules are proposed, not final.

The House Financial Services Committee advanced a bill to overhaul CFPB funding and authority. On September 16, the committee voted 28–21 to advance H.R. 10184, which would subject CFPB funding to congressional appropriations and revise its UDAAP authority. Committee approval did not enact the bill.