New Alliance Moves Beyond Transition and into the Growth Phase
Its been 18 months since the New Alliance Bank sign went up on the lawn at 225 Park Ave. in West Springfield, the headquarters of the former Westbank, which the New Haven-based institution acquired in late 2006. The transition period ended long ago, said regional director Paul Accorsi, meaning that the bank has moved on from mere retention to an aggressive pursuit of across-the-board growth.
Paul Accorsi acknowledged that a few things were different when he went to work on Jan. 2, 2007 after the holiday break.
OK, one rather large thing.
That would be the name on the sign in front of the building at 225 Park Ave. in West Springfield, and also on the wall in the lobby, and on his letterhead, and on his coffee mug. Everything said New Alliance, the New Haven, Conn.-based institution that acquired Westbank for which Accorsi had served as a director of commercial lending for several years in mid-2006.
But, from his perspective, at least, little else was different that morning.
My office hadnt moved, my desk was in the same place, the same pictures were on the walls, and I still had the same phone number Id had for more than 20 years, he told BusinessWest, adding that this sameness, at least with regard to people, their phone extensions, and their knowledge of the local market, has contributed to what he considers a rather smooth entry into the Western Mass. market for New Alliance.
No transition is truly seamless, and there have been some bumps, said Accorsi, senior vice president and regional director of Massachusetts Operations for New Alliance. But 18 months after arriving in this region, the institution is certainly making its presence known.
Indeed, as he talked about New Alliance and its first year and a half in the Western Mass. market, Accorsi talked early and repeatedly about doors. Quite often, he said, when a large regional bank acquires a much smaller community bank, some doors get closed to that new entity, a phenomenon he attributes to the perception that a large entity like New Alliance ($8.2 billion in assets as of the end of 2007) cant be a community bank in the true sense of that industry term.
New Alliance has, by his estimation, shown that it can, indeed, be a community bank in feel if not look, even with those numbers while at the same possessing the lending muscle of an $8 billion institution with 89 branches up and down the I-91 corridor. Thus, far more doors are open than are closed, said Accorsi, and the bank is focused on taking advantage of each opportunity presented to it.
Sometimes, doors do get closed on you, but we really havent seen that, said Accorsi, who attributed this to the fact that, while the banks name has changed, most of the names and faces associated with it havent, and this continuity has made the transition period relatively short and problem-free. The prevailing attitude among customers and potential customers has seemed to be, lets give this bank a shot, and when given the chance, weve been able to impress people.
Joe Shaw agreed.
As first vice president and department manager of Business Banking, Shaw has also seen some doors open to the bank that werent open before namely the large loans involving tens of millions of dollars but the institution hasnt changed its attitude toward, or approach to, its smaller commercial clients.
This is a competitive market, and banks certainly have to competitive when it comes to rates, he explained. But for most customers, its still a function of service, and thats something that hasnt changed here, and wont.
In this issue, BusinessWest looks at New Alliances entry into the Western Mass. market and how its blend of size and community-bank attitude bode well in this highly competitive banking environment.
As they talked about the advantages afforded by New Alliances size and reach, Accorsi and Shaw used words and phrases like firepower and institutional horsepower often and interchangeably.
They did so to pointedly convey the fact that New Alliance can do some things that the old Westbank (which had just over $860 million in assets when it was acquired) could not, especially in the commercial-lending realm, but also with regard to community giving and other matters.
We can probably handle about 80% or 90% of the loans within this market, said Shaw, adding quickly that the portfolio is still dominated by the smaller-business loans that comprise the bulk of demand in this region.
Indeed, while stressing repeatedly that New Alliance has the opportunity to do more and be more than Westbank, Accorsi and Shaw said the institution can be, and is, everything that Westbank was, especially within the community.
As an example, Accorsi pointed to the banks involvement with the Big E.
Don Chase, long-time president of Westbank, was also a fixture as chairman of the board at the Big E, he explained. The bank was quite involved with the 16-day fair, sponsoring exhibits and specific days (usually West Springfield Day). New Alliance has continued that tradition, he continued, by sponsoring Connecticut Day, for example, and also an exhibit of live sharks last fall.
But with a much larger foundation (or budget) for community giving, New Alliance has been able to improve on Westbanks overall performance in that realm, said Accorsi, noting that the bank has added some new beneficiaries over the past 18 months, including the Food Bank of Western Mass. and the Springfield Technical Community College capital campaign.
This increase in community giving while maintaining old affiliations and partnerships is one example of how New Alliances regional bank size and community-bank feel have manifested themselves, said Accorsi, adding that there are many other examples that have come into focus since that Jan. 2 morning when he arrived for work.
Together, they help explain what Accorsi described as a generally smooth transition period one he considered officially over late last year and an effective segue into an across-the-board growth mode.
Were well past retention, Accorsi said of that all-important first stage of a transition when customers will decide whether to stay with an institution, especially one headquartered outside the Commonwealth.
And were solidly focused on growing market share, he continued. Were now in a position where were asking, how are we going to compete in this marketplace every day?
The bank was helped in its transition by a number of factors, said Accorsi. First, there was a comprehensive effort to introduce the New Alliance brand even before the new signs went up. And these efforts continued after they did, with several receptions, many involving New Alliance President Peyton Patterson, at such venues as the Basketball Hall of Fame and the Big E.
Geography has also helped somewhat, he explained, noting that New Haven is closer to the Pioneer Valley in many respects than Boston, where many regional banks are headquartered, and much closer than Charlotte, N.C., home to Bank of America. An attractive suite of products and options such as remote depositing also helps, he said, but, overall, a strong measure of continuity has been the biggest factor.
When asked how to quantify and qualify New Alliances performance in this market to date, Accorsi said there are some numbers, especially with regard to customer retention and the commercial-loan portfolio, that back his contention that the bank is off to a solid start.
Business and deposit retention is ahead of the schedule, he explained, adding that the commercial activity has been strong and, in most respects, better than expected given the immense competition within the local market and the health of the economy or perceptions of same.
Said Shaw, despite the gloom-and-doom headlines, there are a lot of businesses having record years. Companies are adding staff and adding equipment; thus far, the commercial business would have to be considered a pleasant surprise.
Still, much of the performance analysis is qualitative, said Accorsi, returning to those open doors and the opportunities that his lenders are now being given because of that firepower.
With it, we can stay in the market weve always been in, but we can also open the door to some larger deals, where we step in with a new set of competitors, such as Citizens, TD Banknorth, Sovereign, and Bank of America, he explained. This is a different playing field for us, and were getting more of an opportunity to bid on some of the larger deals, and thats all we ask for at this point; people are giving us an opportunity to come in.
On the retail side of the ledger, the bank has moved from what Accorsi calls a transition culture to a sales culture within its 16 Western Mass. and Central Mass. branches. By that, he meant a strong focus on growing market share not through physical expansion, necessarily (as so many other banks in the region are doing), but through products and customer service.
Were in the main communities in this region, and thus far that has worked for us, he explained. There are so many banking functions for which you no longer really need bricks and mortar; were realizing growth through attractive products and good service.
The Bottom Line
Summing up New Alliances first 19 months of business in the Pioneer Valley, Accorsi returned once again to the subject of doors.
None have really closed, he said, and many others have opened, and for all those reasons he mentioned, from targeted marketing to an attractive suite of products, to the fact that New Haven, Conn. doesnt seem a world away, or at least as much as Charlotte does.
But mostly, he attributes it to a large measure of continuity that doesnt always accompany such acquisitions continuity that takes many forms, including a phone number that hasnt changed since 1985.
George OBrien can be reached at[email protected]