Consolidation in the financial industry is hardly a new phenomenon. But recently, several large-scale shakeups have altered the banking landscape: SunTrust and BB&T merged to create Truist Financial in 2019, PNC Bank acquired BBVA’s American business in 2021, and the Bank of Montreal (BMO) finalized its acquisition of the Bank of the West from BNP Paribas in 2023. Banks and credit unions of all sizes have historically participated in merger and acquisition activity, and the trend looks to continue well into the future. This year, Capital One announced plans to buy Discover.

Corporate Insight’s Projects team, our consulting arm, works on various custom projects for companies across financial services and healthcare. As part of this work, as well as our ongoing research in the Bank and Credit Card industries, CI tracks all bank and card communications directed at customers. Pulling from this library of communications, what does a merger or acquisition mean for the customer, and how do banks and card issuers communicate that information?

Here are some tips regarding communications to bank customers during potential merger and acquisition activity:

Transparency is the best policy

Personal banking is an extremely important part of people’s lives, and any changes to the way one manages one’s finances can have major consequences. As a result, it is imperative that any financial institution going through a merger or acquisition keep their customers consistently informed and up to date. Let customers know if there will be a name change that impacts their banking (like when BBVA customers became PNC Bank customers) or if their accounts will be affected, and when.

When SunTrust and BB&T were in the process of merging to create the new Truist Bank, the new firm’s website included a dedicated section pertaining to the merger with a timeline of milestone events.

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Truist Public Site – Merger Guide

While the merger of the two entities was legally complete, not all products and services had been transitioned to the new Truist website. The timeline informed customers from both of the previous firms when they could expect to see their accounts under the Truist banner and when they could expect to see their local branch make the transition to Truist.

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BMO Mobile App Home Screen, Service Alert

When going through a bank merger or acquisition, be sure to issue frequent communications of any and all updates. Customers will appreciate the firm’s transparency as well as the knowledge of when things will change.

Inform customers of changes to the product lineup.

If the product lineup changes during a bank merger, communications should explain that to customers as soon as possible. It is important to remember that customers are used to the current name of their account type, so if products are renamed during a merger or acquisition, it would be best to relay this information to the customer early on. Even if nothing about the product itself actually changes, a new name can be jarring. Humans are known to be creatures of habit, so expect some confusion when assigning customers new account types/names.

As BMO continues to transition former Bank of the West customers to their products, a Welcome Center page on their website clearly states when customers will be transitioned and how they will decide which account each customer will receive. The firm preemptively shares key information with the customer, like when the account will change, what name the account will have, and what dates online banking may be affected. Proactively informing customers of changes to the product lineup can help to reduce the confusion that often comes with changing one’s banking situation.

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BMO Public Site – Bank of the West Customer Welcome Center

 

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Deposit Accounts FAQ

It is also important to keep in mind that some customers may have a greater variety of products and services available to them once a merger or acquisition is complete, usually when a smaller financial institution is acquired by a larger one. This can present the acquiring firm with an opportunity to market their wide range of products and services to an entirely new batch of customers, who may be interested in a greater variety of deposit accounts, credit cards, and more.

Notify customers of any changes to their local branch

While the popularity of digital banking continues to rise, many customers continue to do some or all of their banking in-branch. With that in mind, it is important to inform customers of both firms involved in the merger/acquisition as to the future of the firms’ branches. Customers will need to know whether their local branch will close, or if it will remain open and under what banner. As with all else mentioned so far, it would be best to let customers know the fate of their local branch as soon as possible.

When PNC Bank announced the acquisition of BBVA USA, they made sure to inform customers that all BBVA USA branches would be closed for a period of four days before reopening under the PNC Bank banner. This allowed former BBVA USA customers the opportunity to complete any in-branch tasks before the branches were temporarily closed.

Similarly, any change to the customer’s current ATM network should also be communicated. When introduced to a new bank, the customer may be presented with a larger, expanded ATM network that could be greatly beneficial to them. Communicating new customer benefits, especially during a transitional period, is extremely important.

Alert customers to any necessary action

Typically, customers of a firm that has merged with or been acquired by another firm will be required to take action to access their new accounts. It is essential that the firm clearly communicate these steps early on in the process. The earlier and clearer the instruction, the smaller the chance of having customers barred from accessing their accounts (and their money).

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Charles Schwab Log in Page

Charles Schwab acquired TD Ameritrade in 2020 and announced their plans to have all former TD Ameritrade client accounts fully integrated by 2023. In an effort to assist these clients, the firm added a banner at the top of the log-in page instructing them how to access their accounts with their new Schwab credentials. The banner was placed prominently at the top of the page in a contrasting blue color with bold font and an informational icon.

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Charles Schwab Secure Site Transfers and Payments Page

Once the former TD Ameritrade clients had logged into the Schwab secure site, the firm provided them with instructions and information regarding tasks like moving money and making payments. While some clients may be able to figure out these tasks on their own, there will be many who will appreciate the guidance and communications when exploring and navigating a new secure site interface after a bank merger or acquisition.

For more on the bank and card industry, check our CI’s subscription research service. And learn more about how CI’s projects team can provide the research to help your organization make better decisions.

Devan Grant

Devan Grant is a Project Manager on CI's projects team.