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BANKING BATTLEGROUND Customers up for grabs in fallout from mergers, acquisitions

David Lobach of Embassy Bank for the Lehigh Valley says a lot of banks are looking at Lehigh and Northampton counties for expansion. ‘Everybody is looking for that loan growth, that bottom line growth, so they are looking beyond their normal borders,’ he says./File photo

BB&T takes over Susquehanna Bank and National Penn.

BB&T takes over Susquehanna Bank and National Penn.

KeyBank acquires First Niagara.

Provident Bank gobbles up Team Capital Bank.

Banking transformation is alive and well nationally and in particular in Lehigh and Northampton counties, which have become a focal point of mergers and acquisitions the past two years.

It has created turmoil and disruption in the marketplace – for employees being acquired and consumers seeing their banking relationships uprooted.

And often people don’t like change. The changes to personnel, processes and identities that a merger or acquisition brings to their bank can cause them to depart.

And that, in turn, creates opportunities for other banks – sometimes smaller, community banks that remain independent and can capture greater market share by poaching those disgruntled customers. But it also can be that banks outside the area decide to expand to the region, drawn to the Lehigh Valley because of the area’s strong economic growth and environment.

“There is market disruption when a larger financial institution takes over,” said Rocco Del Vecchio, CEO of Merchants Bank of Bangor. “The smaller community banks are integral and important to that.”

But is merger mania sustainable in the Valley?

Some, but not all, see it occurring well into the next couple of years.

Brian Pedersen
Reporter Brian Pedersen covers construction, development, warehousing and real estate and keeps you up to date on the changing landscape of our community. He can be reached at brianp@lvb.com or 610-807-9619, ext. 4108.

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