Bought a bank? Better tell its customers
A good way to keep customers from abandoning ship when a bank is acquired sounds simple — tell them about the deal. Yet, not many banks seem to do it nowadays, a new study shows.
A survey involving four of last year’s deals — JPMorgan Chase-WaMu, Wells Fargo-Wachovia, PNC-National City, and Capital One-Chevy Chase — showed fewer than half the customers of the acquired institutions reported receiving enough information from the bank about the deal.
Lack of communication could come back to bite the bank, though, as a deal increases by as much as three times the likelihood that customers will switch banks, according to the J.D. Power and Associates report on bank deals.
Moreover, customers who hear about the acquisition in the news or from family and friends are twice as likely to switch banks than those who hear about the deal from the bank itself, the report said.
About 75 percent of customers of the banks being merged said they received information about the deal from third-parties, according to the report. Some 12 percent of one bank’s customers said they first found out about the deal from the survey they received for the J.D. Power’s study. J.D. Power declined to reveal the name of the bank.
The report was based on responses from 3,111 customers evaluating 17 banks. The four more recent deals were chosen because the number of responses from customers of these banks were statistically significant.
“Overall, customers of acquired banks perceive that acquiring institutions are far less focused on customers’ interests and personal service than their previous bank,” said Rockwell Clancy, executive director of financial services at J.D. Power and Associates.
(Photo: REUTERS/Romeo Ranoco)