RiverBank, formerly known as Lawrence Savings Bank, recently opened its doors under the new name. A total of five state-chartered banks in Massachusetts have changed their names this year.
An inside joke among RiverBank staffers is that maybe it would have been appropriate to refer to the institution as the “River Runs Through It Bank,” considering the recent storms and flooding that have affected the Merrimack Valley.
Just a few months after Lawrence Savings Bank began its search for a new name, the bank opened its doors last Monday under the name RiverBank.
“The old bank was very conservative, but not very competitive,” noted Gerald Mulligan, president and chief executive officer.
Mulligan said a simple name change was a “quicker, easier and cheaper” way of letting consumers know that it was changing the way it does business. He said the bank is offering more competitive rates than in the past, and with locations throughout the Merrimack Valley it has grown beyond its Lawrence name.
Internally, the bank came up with more than 100 possible names. “RiverBank” was chosen since the Merrimack River, which runs though the area, is such an important part of the region’s heritage, and the name had a fresh ring to it, he said.
“It’s now. It’s modern. It’s good. It’s new,” said Mulligan.
Already in 2006, five state-chartered banks in the Bay State have changed their names, according to the Massachusetts Attorney General’s Office. Last year, seven banks changed their names.
“A lot of these names are decades old,” said Jim Jones, president and founder of First Wellesley Consulting Group, a management advisory firm specializing in the financial services industry. “I believe single, snappy names resonate better with customers.”
Jones said it is also important for a bank’s name to align with its mission and reflect its geographics. “I actually see it as an opportunity. It gives them a chance to differentiate themselves from their competition and make a statement for today’s customers,” said Jones.
What’s in a name? Banks across the commonwealth have been altering their identity with a simple name change, or so they believe.
Many banks, such as Foxboro Federal Savings, say there was a need to update their old name.
“At one time banks had segregated functions, and you could tell what a bank did by its name,” said Dennis Parente, president of Foxboro Federal Savings, previously known as Foxboro Federal Savings & Loan Association.
The truth is that many bank names are dated, and it’s easy to tell what an institution used to specialize in just by its name, no matter how diverse its products and services are today.
There were once four distinctly different types of financial institutions: the savings bank, the cooperative bank, the credit union and the trust.
Parente said his bank wasn’t looking to make a big change, but felt it was time to shorten its name.
“The name carries a lot of credibility in the towns we [serve],” he said, adding his bank’s new moniker hasn’t stopped it from lending all over Massachusetts and in parts of Rhode Island.
‘An Even Playing Field’
Joseph A. Leonard Jr., deputy commissioner of banks and general counsel at the Massachusetts Division of Banks, said legislation passed over the years eventually granted different types of banks powers that other institutions already had. Eventually, in 1982, a new ruling gave all institutions the ability to perform and offer the same services.
Bank names, which used to quickly tell consumers exactly what the institution did, no longer carried the same clout.
In the late 1980s, saving banks were allowed to drop the words “savings” or “institution for savings” from their names. Until that time, it had been a requirement.
Part of the reason Danvers Savings Bank, now Danversbank, dropped “savings” from its name was because the bank was shifting more toward the role of a commercial bank and away from a traditional thrift, said Dave Munroe, senior vice president/director of marketing for Danversbank.
“It really puts you on an even playing field from a brand standpoint,” he said. “I think for a lot of banks trying to reinvent themselves as commercial banks, it’s a necessity.”
Danversbank officials spent several years contemplating the right new name for the bank. Munroe said the process began in 1997. In 2004, the bank turned to an outside consulting firm for help. In the end, the bank decided to keep things simple.
“We thought it was cool,” said Munroe of the one-word formula several banks seem to like.
Cooperative banks were forced to hold onto the word “cooperative” until 2002. However, one little word was not going to stop the institution whose full name is Saugusbank, A Cooperative Bank, from renaming itself in 2000 for the millennium.
Kevin Tierney, president of Saugusbank, said the bank was launching new products and services at the turn of the century, making it a perfect time to give the institution a new look. Because of the bank-name rules at the time, it was forced to keep “cooperative” in its new name.
Leonard said savings banks and trusts do not need approval from the Division of Banks to rename themselves. However, cooperative banks and credit unions still do, he said.
According to Tierney, Saugusbank has no immediate plans to ask the DOB to drop “a co-operative bank” from its official name.
Julius Roberge, managing director of verbal identity for New York-based Interbrand, helps bankers with naming and branding strategies throughout the country. Although Interbrand works primarily with larger institutions, a lot of the same rules apply. He said a big reason banks seek new names is when they merge or acquire new banks.
“I wouldn’t say banks are reinventing themselves for the sake of reinventing,” said Roberge. “Banks are being forced to because they are acquiring.”
As a bank moves into new areas through acquisitions, mergers or even organic growth, it needs to think about how well its name will go over with consumers.
“We try to help banks understand if they have brand equity or just brand awareness,” said Roberge. When a name has brand equity, he noted, a bank needs to be more careful about just how drastic of a change it makes. Just because everyone in town knows the bank’s name doesn’t mean it necessarily has brand equity, according to Roberge.
Roberge added that mergers can be tricky when it comes to the name game, especially if one bank wants to avoid looking like it gobbled up the other one.
