ABN Amro

Bank of America Buys LaSalle Bank

Bank of America snapped up LaSalle Bank last weekend, April 23rd, 2007, in a surprise bid of $21B. I felt that the Royal Bank of Scotland would be targeting ABN Amro’s US branches for acquisition, competing with Barclay’s in their pursuit, and I believed that the Royal Bank of Scotland would end up the victor and new owner of LaSalle Bank.

I based my belief on the premise that the European banking regulators would view the experience that the Royal Bank of Scotland has had owning a bank based in the United States, namely Citizens Bank of Rhode Island, as a positive factor. Not only has Citizens Bank been a successful operation, it has also grown quite effectively through numerous acquisitions throughout New England and the mid-Atlantic states.

The acquisition gives Bank of America a strong presence in Chicago, Illinois, competing with Harris Bank (owned by the Bank of Montreal) and Chase Bank.

UPDATE: But wait - the deal isn’t done yet. A European court apparently blocked the sale today to let shareholders of Barclay’s and ABN AMRO approve the sale. Bank of America is reportedly saying they have a legally binding agreement, and the Royal Bank of Scotland’s approximate $98 Billion offer is likely still on the table.

Citigroup Buying ABN AMRO’s Mortgage Unit

Seems like Monday’s always have a lot of news about bank mergers and acquisitions. Today’s reports indicate that Citigroup is buying ABN AMRO’s mortgage unit, which doesn’t seem out of the ordinary, considering the recent changes in the housing marketplace in the US. On top of those changes are the lingering effects of the hurricanes in the gulf region, where ABN AMRO’s La Salle Bank does business. One might think that the rebuilding process will benefit banks in the area, unlike insurance companies who have to fit the bill.

Also reporting for Citigroup, Bloomberg has stated that Sallie Krawcheck will be switching roles from CFO to the wealth management department. They also mention that Krawcheck is a potential candidate for CEO in the future.

Hopefully Citigroup will be able to carry on successfully after Sandy Weill.

Foreign Banks in China

China has approved plans for 9 foreign banks to incorporate on the mainland, including:

• Citigroup
• HSBC
• Standard Chartered Bank
• Bank of East Asia
• Hang Seng Bank
• Mizuho Corporate Bank
• DBS Bank
• Bank of Tokyo
• ABN Amro Bank

Good stuff! My guess is that this will have a positive impact on the Chinese economy, and the rest of the world, too. This change was brought about thanks to the World Trade Organization (WTO).