Metro Bancorp, Harrisburg, last month agreed to be acquired by Pittsburgh-based FNB Corp. (First National Bank of Pa.) for stock worth $32.71 a share. It's an afterword to the Commerce Bancorp story: Metro is successor to Commerce Bank (Pennsylvania), last of the once fast-growing, customer-friendly franchises set up by South Jersey banker Vernon Hill's former Commerce, most of which is now part of TD Bank.
The sale price is Metro's highest valuation since the 2008 financial crisis, but remains $4 short of Metro/Commerce's 2005 peak, a sign of diminished expectations. Metro's sale was just about assured when activist investors last year began pushing to stop Metro's long-delayed expansion into east-central Pa. Enough, they said.
What light does any of that shed on Hill's latest and larger project, fast-growing, five-year-old Metro Bank Plc (U.K.)'s plan to sell shares in a 2016 IPO? "It's a different situation," says Robert Costello, of Costello Asset Management, Huntingdon Valley. "The U.K. bank will continue to take market share" as Metro plows through London banking "the way Commerce moved into Philadelphia in the 1980s," Costello told me. He hopes Metro (U.K.) will co-list on U.S. markets so more people here can invest.
"When banks don't grow, they get sold. Absolutely," Hill told me, stressing that he wouldn't comment on individual banks. "Investors will pay for growth whether it comes from online, branching or mobile."
Just growth? "Every shoe store is not the same. The ones that have differentiated models that produce growth," as Commerce did, "get higher values," Hill concluded. "Generally speaking."