Activist funds draw attention to banks as the new wave of mergers takes hold

"The competition is addressing our customers and ensuring their relevance," said William Rogers, SunTrust's Chief Executive Officer. "The good news is that we are coming with very good strength, we have achieved excellent performance on our digital platforms, we have already invested in investments, so we need to double that number, so we consider the competitive environment as anyone trying to acquire customers. "

Activists may be encouraged to push other banks. Already ValueAct has acquired a stake in Citigroup, claiming last year that banks presented a lower risk "than at any point in our investment life".

Although ValueAct has not initiated any public calls for changes on Citi's board of directors or management, the bank has agreed to give the activist investor a better deal. idea of ​​its strategy and operations. The company announced last month that it has entered into an information sharing agreement with ValueAct, giving the Ubben fund access to confidential data.

Many are looking to combine other large regional banks, including Citizens Financial Group, KeyCorp and PNC Financial, said Blue Lion partner Johnny Guerry, who joined the firm earlier this year to help practice activism. Although the shares of these banks have risen so far this year, each has lost 18% in the last 12 months and is trading around 1 at book value, which is generally a sign that shares are undervalued.

"A dynamic M & A market is giving less-performing banks little excuse not to explore other strategic solutions," Guerry told CNBC on Thursday. "The activists have been lobbying Comerica in recent years, and the success of these deals only reinforces the legitimacy of the activists' calls to find a partner."

Blue Lion, though small compared to ValueAct, tried his luck in banking activism in 2018. The first activist attempted to initiate a proxy fight at HomeStreet, a small regional bank active in Washington, Oregon, in California and Hawaii.

According to the regulators, the fund missed its deposit and had to plead with its shareholders to register protest votes against the bank's incumbent directors. The fund did not comment on his future plans at HomeStreet.