Financial institutions that have gained agility through long-term technology investments are better prepared to complete mergers and acquisitions with limited client disruption.

Technology integration during M&A activity is a customer-centric issue for banks, Danny Baker, vice president of market strategy at technology provider Fiserv, told Bank Automation News. Customers want stability and expectations for seamless experiences can be heightened during an acquisition. 

“The pressure is on” for banks undergoing M&A, Baker said. “Technology has to be an enabler.”

That’s where investment in cloud, middleware and APIs serve banks well, he said. The more investment in technology ahead of any disruption — whether a merger, acquisition or global pandemic — the better. 

“All these critical elements are enablers for agility,” he said. 

For example, when Republic Bank, owned by Philadelphia-based Republic First Bancorp, failed April 26, the FDIC orchestrated an agreement for Fulton Bank to take over the failed institution’s 32 branches and $6 billion in total assets, according to an FDIC release that day. 

Republic Bank reopened April 27 under the Fulton Bank umbrella, and clients of the failed bank became depositors of Fulton overnight, according to the release.  

“During the transition, Republic Bank depositors will continue to have uninterrupted access to their accounts through online banking or by writing checks using existing ATMs or credit cards,” Fulton Bank said in an April 26 release. 

This uninterrupted experience is what clients expect during a merger or acquisition, Baker said. 

Ongoing investment in technology and an understanding of the overall technology structure allows banks to be agile while changing out components without affecting customers, Baker said. Keeping touchpoints consistent and executing the desired treatment of customers while expanding is a win for banks, he said. 

Merging assets, accounts, products, data

While the customer journey is key when navigating a merger or acquisition, banks also must consider the technical integration of absorbing billions of dollars, thousands of accounts, new customers and products, Baker said.  

When integrating two institutions, Fiserv looks to completed integrations for best practices and challenges that banks might face ahead of, during and after the process begins, Baker said.  

In fact, Fiserv has created tools and automations to navigate “potholes” commonly found in integrations, one being in data conversion, he said.  

Fiserv will exercise these best practices in the Fulton Bank-Republic Bank conversion as Fulton Bank’s core is Fiserv Signature, according to data and analytics platform FI Navigator. Since 2021, Republic Bank’s core provider has been Fiserv.

While Tom Ruppel, vice president and business strategy manager at tech provider FIS Global, previously told BAN that conversion of tech stacks is easier when the core provider is the same, Baker said all conversions have their challenges, regardless of the provider. 

“We’ve all experienced helping banks merge on every core out there, and we do a pretty good job of creating this body of work to capture those potholes to help banks through [mergers],” Baker said. 

Editor’s Note: In a previous version of this story, it was incorrectly stated that the bank’s core provider was Jack Henry’s Silverlake. Silverlake was the core provider until 2021. This story has been updated to reflect that Republic Bank is on Fiserv Premier core.