CIBC’s (CM.TO) pursuit of Chicago’s PrivateBancorp (PVTB.O) was the right move for the lender, but circumstances may have priced it out of an acquisition, according to the president and CEO of Purpose Investments.

Som Seif told BNN Tuesday that the bank’s attempt to gain a foothold in the U.S. was an essential step to stay competitive, but the market may no longer be right for the deal.

“If the market doesn’t kind of [pull] back, you’re going to have a hard time and you’re likely going to pay more for something in the future,” Seif said on BNN’s The Street. “Or, you pay up for it, in which case you’re ultimately just increasing the value and the economic risk to the business.”

After agreeing in June to pay $4.9-billion in cash and stock for PrivateBancorp, CIBC’s offer has looked less competitive in recent weeks after the U.S. bank’s share price surged in a post-election rally.  PrivateBancorp postponed a shareholder vote on the deal that was scheduled for Dec. 8 after a number of proxy advisory services recommended voting against the transaction. 

Losing the deal would be a big blow for CIBC’s ability to compete with the other big Canadian banks, according to Seif.

“In the last 10 years the Canadian banks have really separated,” he said. “It went from the ‘Big Five’ to really the ‘Big Three’ and ‘the Next Two’, [with] BMO (BMO.TO) and CIBC being sort of much smaller now on a relative economic basis, market capitalized basis, and balance sheet [compared] to Royal Bank (RY.TO), TD (TD.TO) and Scotia (BNS.TO).”

“So, that means that CIBC and BMO have to act very differently.”

Missing out on PrivateBancorp would also deliver a huge blow to CIBC’s ability to expand into the U.S. market.

“I believe that the U.S. economy is going to be one of the more attractive economies over the next decade … so you want to have a toe-hold, or a major position and all the other banks in Canada, pretty much, have done that,” Seif said.

“Scotia has gone global, but everyone else has sort of built their U.S. practices, CIBC is the only firm that doesn’t have it. They need to have something outside the Canadian borders.”