Published in Finance

Retaining clients, talent top priorities for Huntington execs after TCF merger

BY Sunday, July 18, 2021 05:46pm

The $22 billion merger with TCF Financial Corp. brought new leadership for Huntington Bancshares Inc. in West Michigan that’s focused on retaining talent and customers while executing a massive corporate pledge to small businesses and underserved markets.

Krista Flynn will work alongside John Irwin as Huntington’s regional president through the end of 2021, when Irwin retires after more than four decades in banking, including nine as the bank’s West Michigan leader.

Krista Flynn and John Irwin COURTESY PHOTOS

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As they prepare for the leadership transition and TCF’s conversion into Huntington this fall, Flynn and Irwin both say retaining clients and talent are their top priorities. Losing both are a natural offshoot of any merger, and the two veteran banking executives hope to minimize the potential fallout from the TCF-Huntington union in the months ahead.

Flynn and Irwin have been reaching out particularly to TCF staff who joined Huntington.

“We don’t want to lose any good colleagues, we don’t want to lose any good customers,” Irwin said.

Since the TCF-Huntington merger was announced last December, competitors have talked about the potential to lure away clients and talent. Some movement in the market has already occurred with commercial and mortgage lenders who went to other banks.

Bank leaders’ attention focuses on connecting with TCF clients and “making sure they understand that we will take care of them, and that their services will only get better, and we will continue to provide them the best service that we can throughout the transition,” Flynn said.

‘Employer of choice’

Retaining employees sits “right behind” client retention, said Flynn, who was regional president at TCF Bank and joined Huntington through the acquisition that closed on June 9.

“Any sort of combination has a little of this. You just have to put your arms around people and make sure they feel valued and that they’re adding value to the new organization, and that they fit culturally,” said Flynn, citing corporate cultures at TCF and Huntington that are “very similar.”

A veteran commercial banker, Flynn previously worked as regional president at TCF and at the former Chemical Bank.

Her goal is for “Huntington to be the employer of choice.” Part of keeping key personnel is emphasizing that they now have “significantly better products and services” to offer clients than a small bank can provide, she said.

Huntington has also created a “buddy system” that matches TCF staff with a Huntington counterpart to mentor them through the transition and “help new employees figure out internal systems and processes.”

“We’re making great strides in really putting effort into making people feel comfortable and welcome and getting the culture understood by everybody in creative ways,” Flynn said.

Competitors recruit

The movement of talent within a market and the need to actively work to retain staff are natural occurrences following bank mergers.

The TCF-Huntington merger has been no different, especially given the resulting number of planned office closings and branch consolidations, said Hunter Judson Sr., president and CEO at Grand Rapids-based search and human resources consulting firm Judson Group LLC.

Since “the team with the best talent wins most every time,” acquiring banks always “try very hard to keep the best people, but it is very difficult and almost always, there is considerable talent loss,” Judson said.

“Most competing banks have recruited and hired a number of TCF lenders and support personnel — commercial and mortgage. When the merger was announced, they developed lists of top talent and commenced recruiting efforts and conversations,” Judson said. “Since banking is a relatively small network, bank leaders knew who they wanted to hire. Most of Huntington’s competitors have benefited from being able to hire additional qualified talent.”

A ‘major force’ in banking

The Columbus, Ohio-based Huntington’s acquisition of Detroit-based TCF created the largest operating bank in Michigan with $170.8 billion in assets and deposits of $138 billion across its footprint. Huntington (Nasdaq: HBAN) bases commercial banking operations at the Detroit headquarters, while consumer banking is headquartered in Columbus.

Overall, Huntington Bank now has $175 billion in assets with more than 1,100 offices in 12 states.

The integration of the two banks and the name change for TCF offices to Huntington will occur the second weekend of October.

In West Michigan, Huntington became the second-largest bank in the Grand Rapids-area market with $6.7 billion in deposits and a 20.7 percent market share. Fifth Third Bank is the largest bank in the Grand Rapids-area market. Huntington became the third-largest bank in the Kalamazoo-area market with 12 percent of the deposit market, or $646 million, according to a Federal Reserve analysis of the merger.

“We’re going to be a major force in West Michigan with our combined entity,” Irwin said. “We have a great branch distribution system and great colleagues that have joined Huntington.”

Huntington will still have one of the largest branch networks in the state even with the planned closing of 198 branch offices mostly in Michigan, including all of Huntington’s 97 branches at Meijer Inc. stores. As part of receiving regulatory approval for the acquisition, Huntington plans to sell 14 branches in the central Lower Peninsula to Horizon Bank.

Local, small biz support 

Executives at both banks said the merger will allow for more investments in technology and products and services for large and small clients, although executing and delivering on the local level remains vital, Flynn said.

“Scale and investment is a big plus so that we can get better products and services, but it doesn’t matter to our clients from a ‘big’ standpoint. They’ll ignore that. They’re going to say, ‘What does it mean for me?’” she said. “I’ll tell you it’s local delivery and (having) your team intact, and your team is going to service (clients) appropriately.”

As TCF and Huntington spent the first half of 2021 working on the merger, Irwin decided to retire at year’s end. He’s been regional president for Huntington since January 2013 and previously worked for nearly 11 years as corporate banking executive for West Michigan.

“The timing was just perfect,” Irwin said. “The merger with TCF provided the perfect opportunity for me to be able to step aside and allow Krista to take over.”

A week after the acquisition closed on June 9, Huntington announced a $40 billion corporate commitment toward backing small businesses as well as minority and underserved markets.

The bank’s Community Plan focuses on four pillars: small business lending; racial and social equity; home and consumer loans; and community development lending. The bank looks to deploy the capital through partnerships with community organizations, Irwin said.

“We are doubling down on our interest in making a difference in all of the communities we operate in,” Irwin said. “My hope is that we are a positive catalyst for change here in West Michigan and that other organizations will join in. It is going to take all of us to make a sizable difference in these communities.”

Of the $40 billion commitment over five years across Huntington’s 12-state footprint, $11 billion has been specifically dedicated for Michigan, said Flynn, whose region is one of five markets in the state. Her market spans west from Ionia and south from Big Rapids to the Michigan-Indiana border.

To deploy the capital, Huntington intends to partner directly with local organizations that are already working on the same issues at the grassroots level. The bank will “listen first” and “see what they need,” Flynn said. Forging partnerships can help to overcome “trust issues” in minority and underserved communities and neighborhoods and “reach the people that we really want to impact,” Flynn said.

“I don’t want to have flair and just announce some big number, and then not really be able to show what we have done specifically. I want an inventory, ‘This is where we made an impact,’” said Flynn. “It really has to be an ongoing relationship where they feel comfortable trusting and having the conversation with us.

“This is a long game. Any of the issues are not going to be solved in two years.” 

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