2021 M&A Integration Checklist for Bank Leaders


Merger and acquisition concept. M&A integration, otherwise known as post-merger integration (PMI)

M&A integration, otherwise known as post-merger integration (PMI), is the process of bringing two or more businesses together to maximize synergies and ensure that the deal reaches its predicted value. When well-conceived and properly executed, mergers and acquisitions (M&A) can deliver excellent value and help the banking industry grow and expand. However, bank leaders must be willing to go through the necessary steps to successfully bring deals to completion.

Checklist For Executives

Problems in mergers and acquisitions can cause deals to fail or can make it difficult to acquire true value from deals. Top executives are often responsible for M&A integration and play a critical role in the process. The following checklist for executives aims to keep all influential players on track in preparation for a merger or acquisition.

1. Perform Due Diligence

Due diligence is a crucial activity in M&A transactions. The process of due diligence allows buyers to confirm important information about sellers, such as their financial status, contracts and number of customers. With this information, the buyer is able to make a more informed decision and close the deal with greater confidence.

2. Conduct an IT Assessment

Security is a common concern during M&A transactions. Failure to understand how a merger or acquisition impacts the various aspects of IT puts banks at risk. An IT assessment provides a complete view of a bank’s IT portfolio, including people, process, systems, infrastructure and cybersecurity. The assessment should result in a plan to optimize IT, thereby enhancing its value to the bank, reducing risk, decreasing costs, and improving cybersecurity.

3. Maintain Customer Accounts

Business people shaking hands. Mergers and acquisitions often come with uncertaintiesMergers and acquisitions often come with uncertainties. Some bank leaders worry that an M&A transaction will impact customer experience and cause them to flock to competitors. An important part of M&A integration involves developing communication and retention strategies for maintaining customer accounts.

4. Develop New Business Processes

M&A integration may require bank leaders to develop new business processes for the betterment of the company. Every business is different, which means that these processes will vary. However, new business processes should be strategically aligned with a bank’s long-term goals for optimal growth.

5. Review Existing Products and Services

Before two banks integrate, it is important to review each individual bank’s unique products and services. The decision will then need to be made to continue providing these products or services, combine certain aspects, or eliminate certain products and services altogether. The branding associated with each product or service must also be analyzed.

6. Integrate Departments and Structures

In addition to reviewing each bank’s existing products and services, bank leaders should also look at their existing departments and organizational structures. A decision will need to be made to retain each individual department, combine certain departments or to have departments take on new responsibilities.

Checklist for Human Resources

Human Resources also plays a critical role in M&A integration. With the help of Human Resources, banks are better able to meet the needs of key employees and customers, resulting in higher retention of both. The following checklist for Human Resources can help ensure that M&A integration is completed with minimal interruptions.

7. Ensure Top Talent is Retained

One of the greatest challenges that a bank undergoing a merger or acquisition must face is how to retain people that are critical to their performance. M&A negotiations can spark anxiety and some employees may choose to take their experience elsewhere. For the future needs of the bank, leaders must focus efforts on retaining valuable talent in a variety of ways.

8. Establish Employee Benefits and Payroll

Properly handling employee benefits and payroll during a merger or acquisition is essential for a successful transaction. Leaders must consider whether one bank’s benefits prevail over the other and how to handle major differences in benefits. This often requires the development of a new payroll and benefits structure.

9. Create New Policies and Procedures for Employees

Businessman with business graph information. M&A integration may require bank leaders to develop new business processes

M&A integration generally requires the creation of new policies and procedures for employees. Bank leaders must formulate strategies that include the development of key rules, policies and guidelines that govern employee behaviors and establish workplace expectations. These changes should be communicated to employees in a consistent way, and feedback should be solicited to ensure that everyone is on the same page.

10. Develop and Conduct Employee Training

The importance of employee training in the post-merger integration process is often overlooked. Training helps to get all new and existing employees quickly up to speed on new processes and procedures which reduces wasted time and leads to a greater level of performance.

Speak with an M&A Advisory Firm Today

Today, many bank leaders are pursuing growth through mergers and acquisitions. These complex endeavors require executives to carefully articulate a growth strategy that seamlessly aligns with their broader corporate strategy. Learn more about M&A integration for the banking industry by reaching out to the experienced M&A integration advisors at Hartman Executive Advisors.


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