US Bank, the
Minnesota-based regional lender that is quickly turning into a
first-tier national bank, has been on an unprecedented acquisitive
streak of late: two years ago the bank began a string of
FDIC-assisted and other opportunistic deals, adding 150 branches
and $119bn in deposits. Charles Davis reports.
Go deeper with GlobalData
From the absorption of
two Southern Californian thrifts and the former Colonial Bank
branches acquired from BB&T, to the integration of nine
separate banks from the failed FBOP Corporation purchased in a
loss-sharing arrangement in 2009, US Bank has perfected the art of
the deal.
Central to these deals –
especially the FDIC-assisted acquisitions – is the art of what in
many cases is an overnight transition from failing bank to US Bank
management, signage and corporate culture.
Mary Blegen, US Bank’s
executive vice president for employee engagement and leadership
development, walked RBI through the bank’s ‘buddy system’.
It is a programme designed to ease what could be a traumatic event
for the target institution’s customers and employees; and in the
majority of cases, there are only a few hours before the branch
transforms itself into a US Bank outlet.
“We come in when the deal is
made, and if it is an FDIC-assisted deal, we know first that the
employees must be aware of who bought them and that all is stable
now,” Blegen said.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“We typically have the
overnight hours to brand the branch and re-open as US Bank, so we
want their branch manager and their buddy from US Bank standing
side by side in the morning, talking to each customer,
demonstrating the partnership.”
That requires some amazing
logistics, in a huge hurry. Blegen’s training teams do a lot of the
legwork in advance, identifying managers in each of the bank’s
geographic regions who have the personality and the wanderlust to
get the job done.
“We build lists, in advance,
of the managers who don’t mind the travel at a moment’s notice and
who are extroverted enough to walk into a tough situation and make
it work,” she said.
“That way, when we get word
of a deal, we are ready to move quickly. With most of the
FDIC-assisted deals, we know about them only for about 24 hours, so
it’s a critical time.”
Bankers from the acquired
lenders are assigned “buddies” in other branches, who check on them
and help them navigate the company’s systems and
procedures.
The “buddies” are peer
managers from other branches, and not superiors, Blegen said, so
the new employees feel they can ask questions about literally
anything related to their new bank’s management principles without
seeming uninformed in front of their chain of command.
“The buddies serve as
long-term mentors after the integration as well. The new employees
know they have someone to turn to whenever they need a quick
question answered, and they know they have an experienced hand to
turn to when things pop up weeks later.”
Blegen’s group includes 148
trainers across 24 states. They have been constantly on the move,
visiting US Bank’s 3,013 branches to educate new employees and to
introduce new products or regulations.
“We’ve got 62,000 people
spread worldwide,” Blegen said. “To build a corporate culture, you
need to be communicating consistently across the institution. As a
company, we know that we have to line up with the business goals of
the company, but if the training doesn’t meet a need that the
branch has, it is a waste of time. So we work on lining up training
with deliverables.”
Blegen’s Enterprise Learning
Services Division gets involved in all regulatory training, and all
compliance training on an annual basis. They are doing online
learning on compliance issues in the US and the bank’s nine
European Union markets as well, she added.
Having added several thousand
employees through acquisitions in the past two years, Blegen said
that the usual pace of regulatory and compliance training must be
augmented by general leadership training as well, as part of the
orientation process.
The sheer size of the
enterprise has Blegen moving more of the regulatory and compliance
training into online modules, but when a new product’s success is
at stake, she feels that in-person training is the only viable
approach given the stakes.
For example, when US Bank
launched its new START (Saving Today And Rewards Tomorrow) savings
product earlier this year, Blegen dispatched trainers to every US
Bank branch in the network, a huge investment in terms of time and
money – but it was worth every cent, she said.
The product allows customers
to regularly transfer money into a savings account and to earn
rewards when they reach certain savings milestones. Customers
choose how they want to contribute and how much they want to save,
whether it is a little every week, a little with every paycheck, or
a little with every debit or credit card purchase. To accelerate
the savings, customers can also automatically sweep into their
START account the cash they earn through their FlexPerks rewards
programme.
Savers are rewarded with a
$50 US Bank Rewards Visa Card when savings balances build to
$1,000, and if they maintain that balance for one year, they will
earn another $50 Rewards Visa Card from US Bank to use as they wish
– no strings attached.
“It’s a product with a lot of
moving parts, and so we decided to do all 3,013 branches in
person,” she said. “It was a huge effort, but it also was a moment
where the employees saw the obvious value; they mentioned it where
it made sense and we really have seen the product take
off.”
To facilitate more effective
cross-selling of START and other products, Blegen’s team trains
branch staff on what she calls “effective listening,” which
includes work on identifying physical and verbal cues from
customers. Trainers role-play with branch staff, demonstrating the
cues that signal when to cross-sell – and when not to.
“You can’t practice on your customers,” she said. “So we
practice on one another.”
