As banking mergers and acquisitions activity heats up, and financial institutions seek to meet consumers’ post-pandemic, values-driven expectations for brands, the question arises: How will M&A play a role in delivering on purpose and benefits that fall outside the balance sheet?
One example perfectly encapsulates the new possibilities with purpose-driven M&A. Raleigh-based First Citizens Bank – whose merger (awaiting completion) with CIT Group will create a top 20 U.S. bank – recently announced a transformative investment initiative – a $16 billion dollar plan focused on development in underserved communities hardest hit by COVID’s impact.
The plan, which First Citizens developed in partnership with the National Community Reinvestment Coalition reinvests in low- and moderate-income communities and neighborhoods of color. The lending and investing initiative focuses on areas of affordable housing, particularly for minority borrowers in light of pervasive lending disparities. In addition to housing, funds will be earmarked for minority-owned small business and community development from 2021-2025.
As Frank Holding, chairman and chief executive officer of First Citizens, notes, the plan is a direct expression of the core values of the merged institutions: “We’re pleased to… bring additional investment to our markets and help grow these vibrant and diverse communities and businesses – at a time when these efforts are truly needed. We have a legacy of giving back to the cities and towns we serve, and this plan serves as a testimony to the commitments and values that will represent our combined company.”
As a powerful manifestation of the bank’s “Forever First” brand promise, the investment puts the needs of individuals, businesses and communities the bank serves unequivocally first. Gaining value by giving value or as Holding says, “[The investment] solidifies our path forward and will accelerate new opportunities for underserved communities and customers.”
To learn more about how your bank or credit union can leverage the power of purpose-driven banking through M&A and beyond, email firstname.lastname@example.org.