New Report Finds Banks, Credit Unions Merging To Fund Tech Investments
By CU Today Staff —
MEMPHIS, Tenn.—A new report from SRM suggests the current wave of bank and credit union mergers is being driven less by financial distress and more by the growing need for scale to support investments in technology, talent and payments infrastructure.
According to SRM’s latest Perspectives report on M&A, bank merger activity increased approximately 45% in 2025, with 33 bank deals announced during the first quarter of 2026. Credit union consolidation, meanwhile, has remained steady. The report argues that many institutions now view mergers as a strategic tool to remain competitive rather than a response to economic pressure.
“Every institution considering M&A asks whether the numbers work and the timing is right,” said Pete Duffy, managing director of M&A Advisory at SRM and one of the report’s authors. “The ones that create durable value are also asking a more demanding question: What can we do together that neither of us can do alone? That requires a specific, defensible answer from both sides before the deal can advance—and the data makes it clear why getting that answer right has never been more important.”
SRM said regulatory conditions have become more favorable for transactions, noting median deal closing timelines have fallen from 185 days in 2024 to 131 days in 2025, while valuations have stabilized. The report also found that merger-of-equals transactions are increasingly producing cost savings exceeding 20%, while technology-focused mergers can boost customer and member acquisition by 10% to 15% when integration is executed effectively.
The report further identified technology integration, vendor rationalization and payments infrastructure as key determinants of merger success. SRM said institutions that delay technology integration planning often fall short of expected synergies, while one recent merger-of-equals engagement generated more than $250 million in savings through renegotiated network, processor and technology contracts.
“Margin compression, competition, and investments in technology are not going away,” said Keith Ash, managing director at SRM and a contributor to the report. “What has changed is the cost of inaction. Our findings show that the institutions that are able to move with clarity now have the opportunity to shape the competitive landscape before others have even finished debating whether to enter it.”
Originally reported by CU Today.