The late M&T Bank CEO Robert Wilmers was as close as one could come to reigning over Western New York as its titular monarch. The installation of Rene Jones as Wilmers’ successor at the Bank is of no small consequence to Western New York. The region is on edge, yearning for leadership and wistfully thirsting for economic revival.
The Bank’s leadership makes no secret of M&T’s interest in building a national branch network through acquisitions. Market pressures in the industry, fueled by the much lower cost advent of online branchless banking, will force consolidation.
Whether M&T Bank can emerge from this disruptive period sill independently managed here in Buffalo, will undoubtedly be the leadership test that will define Jones’ tenure at the Bank — and define his proverbial reign over Western New York.
Some things about M&T’s culture cannot be changed — it’s a conservative place with conservative lending practices and conservative values. But virility would suggest that Jones’ tenure will be characterized by a more aggressive pursuit of acquisition opportunities to broaden the reach of the institution.
Executives at the Bank are looking at acquisition opportunities. They are particularly interested in Boston-based branch networks that would give them reach into New England; and in various small branch networks across the state of Florida.
Growth through acquisition doesn’t address M&T’s biggest long term challenge: cultivating a greater capacity to innovate, perhaps even to the point of evolving its corporate culture.
The Bank has been slow to engage with the ‘fin-tech’ space, in large part because of it’s conservative culture, particularly related to hiring. It suffers from a stark lack of diversity and a conformist ethos that prevents it from doing bold things.
That’s why it was so exciting to hear last week that billionaire B. Thomas Golisano was open to a merger between M&T Bank and Paychex, the $25 billion dollar firm that he founded with $3,000 and a credit card in the late 1970s. Golisano remains very excited about the concept and supportive of merger talks, but attempted to squash reports of his excitement earlier this week.
Paychex released a statement calling The Chronicle’s report ‘false.’
Our sources say that Golisano was angry with the report because it undermined his negotiating position, perhaps portraying him as too eager. A stronger negotiating posture could have an impact on valuations in such a transaction. The Chronicle stands by its initial report.
Several informal channels of communication between executives at both companies are actively considering post merger integration — and the impact it would have on both the Buffalo and Rochester metropolitan areas. It is generally agreed that — since the firms’ operations are complimentary — that no jobs will be lost at either firm as a result of such a merger. That is no small consideration when regulators are involved.
Still, employees worry about the implications of automation on the financial services industry generally. Job growth will only happen through innovation and the launch of new product or service offerings.