6 Steps for a Successful Post-Merger Bank Integration


post merger bank integration conceptMergers and acquisition (M&A) activity in the banking industry hit a record high in 2020 with over 1,300 successful deals, according to data from Finaria.

This number exceeds the combined total of M&A deals made in 2018 and 2019. The merger process can be complex and there are many important aspects to consider, such as how the new organization will operate and which changes will be implemented.

By developing a post-merger strategy, banks increase their odds of successful integration. The following key steps can aid banks post-merger.

1. Appoint an Integration Management Team

Many people are involved in M&A activities, including senior executives, human resources and due diligence team members. However, one of the most important roles in post-merger bank integration belongs to those on the integration management team, who act as a voice for others in the company and ultimately drive the post-merger integration process.

Problems are most likely to arise within the first six months following merger activity. Having the proper leadership in place can help minimize interruptions to ongoing business and ensure a successful transition for management, employees and customers.

2. Establish a Plan and Budget

With input from the integration management team, bank leaders must develop a plan that prioritizes and sequences critical post-acquisition tasks. The plan should include roles, responsibilities and accountability, with consideration given to what can be accomplished by specified deadlines and what daily tasks or projects should be delegated to employees who are working on the merger.

If this cannot be easily achieved with the current workforce, another option is to bring in 3rd party experts to assist with the post-merger integration. This cost should be worked into the budget, along with other expenses that may arise post-merger.

3. Schedule One-on-One Manager Meetings

Strong communication between managers is key to establishing trust and sharing important information about ongoing operations.

senior company leader presenting employees new corporate plan

Leaders should schedule regular one-on-one meetings with managers to ensure that all parties have the appropriate information and are able to lead the M&A project more effectively. These meetings can help prevent rumors and miscommunication, and also unify key players from different departments.

It’s important to keep senior management informed on any changes that occur during the post-merger bank integration through any means necessary, such as phone, email or instant messages.

Remember that employees will often turn to managers with questions and concerns so management must share similar knowledge and be prepared with unified responses.

4. Address Overlap Between Both Sides of the Merger

During and after bank mergers, it is necessary to consider the core processes for each bank and how they are similar and different. If there is some overlap, leaders must determine the direction in which they want to continue and possibly reduce the workforce needed to complete certain tasks.

Post-acquisition challenges occur when change management is ignored. Major business changes require the proper change management practices along with a detailed analysis of the new business and the areas need to be addressed. Consider creating a post-merger integration questionnaire to gather feedback then present the findings to executives.

5. Identify Any Potential Leaders Across the Organization

Mergers are high-risk, high-profile activities that require exceptional leadership within an organization. If a company is currently lacking leadership in any one area, it’s necessary to identify individuals who could provide direction for the organization during the post-merger bank integration. Ideally, these leaders should have some integration experience, especially with complex or large mergers.

Mergers provide ample opportunity for businesses to build their technical skills and transform their support functions. Investing in post-merger integration leadership is imperative to create a stronger and more unified team.

6. Begin Investing in Bank Innovation and Technology

Having access to updated and innovative technology can make a significant difference in a bank’s ability to be successful post-merger.

successful business people having a meeting in executive

Bank leaders must take several factors into consideration when analyzing their technological needs, including which system is best suited for the combined organization, the cost to opt out of current relationships, and the end users impacted by migrating systems.

It is also crucial to consider potential security risks that may emerge as technology is changed or updated. Banks must develop a strategy that takes into account network consolidation, telecommunications networks, data and servers migration, and similar tech-related areas. The technology must also comply with federal and state regulations.

Speak with the Bank M&A Advisors at Hartman

With bank mergers and acquisitions increasing at a rapid speed, bank leaders need to understand how to grow with minimal interruption to their business operations and customers. To learn more about the steps involved in a post-merger bank integration or to speak with a qualified bank M&A integration advisor, reach out to the experts at Hartman Executive Advisors today.


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