What is going to be happening with the financial advisory practices of the two companies?
KRUSZEWSKI: We are going to combine [them]. We are going to do our financial services industry channel, if you will, under the KBW brand.
MICHAUD: Together we are both more complete. Stifel has just done an excellent job of building a broad-based platform, and with this partnership they want to be the best middle-market investment bank in the industry.
Was this a shopped process? Were you out there talking about merging with anybody else?
MICHAUD: I can't answer that question because of the regulatory rules.
Tom, can you talk about you feel personally about this deal? This transaction caught a lot of people by surprise. The firm has had difficulties, but it seemed like you were making progress going it alone.
MICHAUD: We think this is the right deal for our shareholders, for our clients and our employees. This is in my opinion the trifecta. We're trying to build a great company over the long haul, and we think we have moved ourselves forward many years by joining Stifel.
The KBW brand is surviving.
KRUSZEWSKI: Absolutely. We recognize the strength of the brand, and we intend to not only maintain it but to build upon it.
What is your forecast for bank M&A for the rest of this year and into the next?
MICHAUD: I think it is building. Most of the deals are small, but I think M&A is definitely building at a gradual pace. However, I don't think it's the big tsunami that is often talked about. The industry needs to consolidate, and with the theme of interest rates being as low as they are for a longer period of time I think that that is a pretty good environment for more bank consolidation.
KRUSZEWSKI: We're investing near the trough versus the peak, and I believe that the cycle will turn. In any event, it is a marathon, not a sprint, and I do think the M&A market is going to heat up. All of these factors bring Stifel closer to being the premier middle-market investment bank in the country.