In the past five years, Connecticut has had a front-row view of two of the nation’s biggest bank mergers since before the Great Recession — and it may witness more, bankers say.
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In the past five years, Connecticut has had a front-row view of two of the nation's biggest bank mergers since before the Great Recession — and it may witness more, bankers say.
In April 2011, former New Haven lender NewAlliance Bancshares combined with regional lender First Niagara Financial Group, vaulting the Buffalo, N.Y. financial services company into the ranks of the largest U.S. banks.
Now, it's First Niagara, with $40 billion in assets, that will soon be absorbed into Ohio bank giant KeyCorp, the nation's 29th largest lender with $98 billion in assets. The $4.1 billion merger is due to close in the fourth quarter.
KeyCorp senior executive Christopher M. “Chris'' Gorman says more combinations among the nation's 5,300 banks are inevitable.
“It's my personal opinion you will now start to see consolidation,'' Gorman said during a recent Hartford stopover to tour First Niagara's Connecticut operations and meet with employees, customers and community leaders. “Whether it's the start of a lot of consolidations, that remains to be seen.''
Moreover, brightened prospects of late for an interest-rate hike would make loans more profitable for a consolidated Key-First Niagara and other U.S. lenders.
For now, foremost on the minds of Gorman and Jeff L. Hubbard, the First Niagara senior officer whom KeyCorp has chosen to run its Connecticut/western Massachusetts operations, is prepping First Niagara staff and customers for their conversion to Key.
Gorman, who is coordinating integration of both banks, and Hubbard have been making rounds of late, visiting First Niagara's three Connecticut hubs — Hartford, New Haven and Norwalk — their second round of visits since right after the merger was announced last October.
Both say KeyCorp – parent to KeyBank – plans to maintain sizable staff and operations presences once the merger formally closes. First Niagara has 650 Connecticut employees at 65 branches and offices, nearly all of whom will transition into KeyBank staffers, officials said.
“Job one has been the people,'' Gorman, president of the Key Corporate Bank unit, said during his and Hubbard's Aug. 25 Hartford stopover at First Niagara's downtown offices at 100 Pearl St. “Our whole philosophy in integrating [the two banks] is to reach out and capture the hearts and minds of our employees.''
Getting employees on board with the merged organization, and addressing their questions/concerns, Gorman said, serves as a run-up to Key's efforts to next reach out to First Niagara's corporate and consumer customers with a big marketing push, beginning this fall.
The pair's Hartford visit culminated with them attending KeyCorp's meet-and-greet at downtown's Society Room.
Though Key will retain New Haven as base for its southern New England region, “Hartford is important to us,'' Hubbard said.
Hubbard is a familiar name and face after three decades spent in Connecticut's banking circles, including stops at Webster Bank, TD Bank and Bank of America, which entered New England in the 1990s through its purchase of Fleet Bank, where Hubbard also worked. He joined First Niagara as its New England regional president in June 2015, after serving as TD Bank's regional vice president.
Martin Geitz, president of Simsbury Bank & Trust Co. and past president of the Connecticut Community Bankers Association, worked at Fleet Bank around the time Hubbard also was there.
“He's a great guy. He's a really great choice by Key to take a leadership role in Connecticut,'' Geitz said.
Hubbard said his deep knowledge and experience with Connecticut's business community, and its economy, are skillsets he intends to leverage to make KeyCorp successful in this region.
“I will have an advantage,'' he said, “in that I know the community extremely well. It's all about trust and confidence. It's always been. Knowing your customer. Knowing your banker. Not surprising people.''
Key was already present in northern New England, primarily in Maine and Vermont. The merger fills Key's gaps in Connecticut and Massachusetts.
The Northeast, Gorman said, “is a market where we can be impactful.'' Indeed, Key's industry expertise meshes with some of the same ones that are important to Connecticut's and the region's economies, among them renewable energy and facilities-based health care such as hospitals, rehabilitation centers and nursing homes and other long-term care sites.
He said Key's embrace of digital-payments and mobile-banking platforms, too, will be beneficial to that effort.
Concurrent with the merger's closing in late September, Hubbard said Key will be replacing First Niagara's office and branch signage with its own logo. Key this summer announced its intent to shut 106 KeyBank and First Niagara branches in four states, including three First Niagara locations in Connecticut but none among its Hartford area network. First Niagara has about eight western Massachusetts branches.
