Who's Gonna Buy E*Trade?

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All the talk seems to center around Schwab and TD Ameritrade. Seems to me, though, the only thing in it for those two firms is scale.

Here’s who I think should acquire E*Trade: Commerce Bank.

Culturally and financially, I don’t know if this is a great fit, but the two firms would complement some of each other’s relative strengths and weaknesses:

  • E*Trade really knows the online channel, Commerce….not so much.
  • Commerce delivers great customer service, E*Trade….not so much.
  • E*Trade understands banking and brokerage, Commerce….not so much. (I don’t know this for a fact, just guessing. Sorry if I’m wrong).

I know everyone loves Commerce for its great service and branch experience. But, as far as I’m concerned, that’s a future liability, in terms of attracting younger consumers. Which E*Trade can help with given its online expertise.

E*Trade’s current market cap, just a hair above $2 billion, should be peanuts for a bank like Commerce.

Oh well, it’s just a whim.

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