Bank Marketing
White Paper | Best Merger Communications 2022

White Paper | Best Merger Communications 2022

Maximizing the Value of the Transaction

a sneak peek into our 2022 Bank Merger Communications Guide

As we head into 2022, the banking consolidation world is facing a number of challenges. Many are no different from those that boards and bank leaders face daily, such as sustainable growth strategies in a changing rate and competitive environment, the recent impact of the pandemic on attracting and retaining talent, and the need for strategic approaches to environmental, social and corporate governance.

These burgeoning issues that banks face are also part of the reality in exploring the possibility of growing through acquisitions. Add in the emerging importance of examining corporate culture synergies (or lack thereof), retention and growth from acquired businesses, and the increasing importance for bank boards and management teams to clearly understand what the underlying data created by a combination means and you have a daunting set of execution requirements.

As we have stated before, the fact is that most banks don’t and won’t dedicate additional resources to this one-time project. Communication and transition activities just get added to the daily activities of existing marketing, business-line and operational staff. Include the fact that each merger contains different success factors and it is no wonder the change presented by mergers requires overcoming real challenges.

In this volume of Bank Merger Communications – Maximizing the Value of the Transaction, we take an updated look at the four key audiences to consider during a merger and look at how the issues listed above are changing how banks must manage messaging during these periods and how to measure success. Much of the content is similar to past versions simply because the points remain critical.

This eBook is more than a how-to guide for navigating checklists of dos and don’ts for merger communication. It is a resource to help bank executives think strategically about how to effectively plan and execute high-impact communications to an array of audiences using all the key elements of the two bank brands – acquirer and acquired – and build a solid foundation for post-conversion alignment.

In this document, you will learn more about the concepts of stakeholder identification and prioritization, integrating communication more deeply into the operational aspects of a merger, and how to evolve from a mindset of simply surviving the merger to leveraging it as a launching pad for all the new customers you will now be able to build banking relationships with over time.

A glimpse into what you will find in our Merger Communications guide…

Stakeholder Identification Banner | Bank Merger Marketing

I. Stakeholder Identification and Prioritization

Tactically, the first step of a merger communications program typically entails releasing an announcement to the press and posting it on the merging institutions’ websites. After months of private negotiations and due diligence, it’s understandable that both parties simply want to announce the deal quickly and move forward.

The reality is that marketers and bank leadership need to think more strategically about the distinct audiences impacted by the merger, what they care about, what you will say to them and when/how you will say it. There is no one-size-fits-all approach for these critical announcements, which can backfire and migrate communication activity from proactive positioning to reactive restatements. At BKM Marketing, we view the bank stakeholder landscape through the lens to the right. We like to call it a lens because it should be the driving focus for your merger communication strategy at all times. So let’s look at each stakeholder in the lens in more detail.

Merger Communications Lens Diagram | Bank Merger Marketing

Employee Communication

For many years, communication around merger activities primarily focused on existing account holders, and for good reason – there is a regulatory requirement to do so. Recently, we have seen a significant amount of focus on how a merger will impact employees of the acquired bank as well, not just for human resources benefits and operational roles and responsibilities, but also for how the acquiring bank needs these key stakeholders to engage with customers and the market in general.

Employee Communications Channels | Bank Merger Marketing

Existing Account Holders

This is a no-brainer, right? A bank acquires another bank – and its customers – so you have to communicate the merger to them. Sure. There are regulatory requirements that outline everything you need to do and when you need to do it. Box checked? Not really.

There are inevitably a number of assumptions related to what customers need to know, but the reality is that each bank has established a series of long-tenured and potentially complex relationships with customers over time. It would be unwise to ignore this fact in the course of building communications with the bank being acquired because, ultimately, that is the core value for why you want the merger. Once you have solved the employee challenge, bank leaders need to determine their intentional path for communications with customers of the acquired bank. So, where do you start? 

Sample Audience Matrix | Bank Merger Marketing

Prospects and General Market

While the first two stakeholder groups are critically important for the near-term success of a merger program, keep in mind that the broader market is also watching to see how the merger comes together, whether the acquiring bank is credible and follows through on its press release messaging, and the like. Many banks rely heavily on centers of influence to generate organic business opportunities. In addition, mergers draw attention from competitors – and customers of competitors. The effective management of communications that includes consideration for the broader market can create significant value as the merged bank continues forward.

Choosing Digital Merger Communications Diagram | Bank Merger Marketing

Community Investment

In addition to viewing the broader market as potential customers and employees, another important aspect to include in the merger communication plan is the marketplace for community investment activities. This is an item that is often overlooked in the communication plan because it isn’t something that is easy to quantify. In its simplest form, communities want to ensure that the level of support that the merged bank will provide will at least be at the same level as in the past but often with an expectation that it will increase. This is not only a community bank issue; you can look at the efforts of large regional banks and see that this really matters. The acquiring bank needs to understand the charitable giving and community investment history of the acquired bank to ensure that potential oversights on commitments do not happen and that the message to the community remains solid for the future.

“Had we really known during due diligence how different our corporate cultures and operating models were, we honestly wouldn’t have pushed quite as much to get the conversion done so quickly. We uncovered more than we expected the more we dug into what we were acquiring.”

Merger Project Lead, $20B Regional Bank
Defining Successful Merger Banner | Merger Communications | Bank Merger Marketing

II. Defining Your Successful Merger

Over decades of bank mergers of all sizes, one thing remains clear: each merger is to some degree different. While learnings from past mergers are certainly helpful and there are many aspects that can be standardized to become more efficient over time, the fact remains that for many mergers, it is more about the bank being acquired than the bank doing the acquiring. There are a number of reasons behind this statement – ownership structure, organizational culture, employee base, customer base and market presence among them. If mergers were just a simple box-checking exercise, they may be more prevalent. Banks need to move beyond financial metrics to define success for each merger. The financials are critical, but they can’t be met without due consideration of at least three other aspects as well.

Acquired Customer Growth Chart | Merger Communications | Bank Merger Marketing

Banks need to move beyond financial metrics to define success for each merger.

See our Tips for Defining Your Successful Merger.

Bank Merger Marketing | Bank Merger Communication Key Takeaways

III. Bank Merger Communication Key Takeaways

Mergers in the banking industry are a reality that doesn’t show signs of slowing down anytime soon. Most banks are going to be strategic and not serial acquirers – and for many good reasons. Because of this, it is important to get each merger right and communicate effectively throughout the process.

Download our Bank Merger Communications – Maximizing the Value of the Transaction for takeaways that bank leaders and marketers should ensure make their way into the next merger communications program.

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