Optimism is on the rise among owners of mid-sized U.S. companies, according to a new Citizens Commercial Banking survey examining the impact of the presidential election on the appetite for mergers and acquisitions.
More than half (52 percent) of owners now believe that economic conditions will improve in the coming year compared with only 34 percent prior to the U.S. election. The follow-up survey of business leaders, conducted last month, also found that 38 percent of respondents thought the election would boost what the previous Citizens Commercial Banking Middle Market M&A Outlook revealed were high expectations for M&A activity in 2017.
“The election results added more fuel to a positive outlook for mergers and acquisitions among middle market U.S. companies this year,” said Bob Rubino, executive vice president and head of Corporate Finance and Capital Markets at Citizens Commercial Banking. “Some CEOs are still in wait-and-see mode, but they are optimistic about possible changes that could improve their bottom lines and generate more deal-making opportunities.”
Middle market companies – with annual revenue between $5 million and $2 billion – are key creators of jobs and drivers of economic activity in the United States. Citizens Commercial Banking serves thousands of middle market clients in a wide range of industries across the country.
Citizens Commercial Banking’s survey provides insight into the behaviors, attitudes and perceptions of business owners and CEOs as they consider their corporate development strategies for the year ahead. Other key findings include:
- Among middle market business owners, 71 percent anticipated lower health-care costs to their business in coming years and 68 percent expected fewer federal regulations.
- Seventy percent said they expected lower corporate tax rates while 54 percent anticipated lower individual tax rates and 39 percent expected capital gains tax rates to go down.
- Twenty-two percent of business owners are even more likely to engage in M&A activity in 2017 following the election.
- The percentage of survey respondents who expect a significant financial crisis in the next three years dropped from 48 percent to 41 percent.