Bank mergers and job shuffling go hand in hand. When banks combine, many employees know it’s time to start dusting off their resumes. And as continued consolidation reduces the number of banks to work for, bankers have begun turning to non-traditional areas like Internet banking and high technology firms.

“The whole banking universe of candidates has been drastically reduced because of mergers,” said Timothy G. Greene, president of Greene and Co., a financial search firm in Sherborn. “People are saying ‘I’ve been merged three times and I’m sick of it. I’m going to go home and raise a family or go into a dot-com business or whatever,'” Greene said.

Veteran banker and former USTrust Chief Executive Officer Neal Finnegan made the transition into the insurance industry, becoming CEO of Lumber Insurance Companies in Framingham. Many others have moved to the mutual fund and investment management industries, which have grown considerably at the same time banks have consolidated.

“If their computer skills are good and they have experience in the investment area, there’s a whole host of Fidelitys and Putnams around that people can find places,” Greene said.

As a result, the Boston executive search firm the Hayden Group has shifted its emphasis from banks to other financial companies. Five years ago 80 percent of the company’s clients were banks. Now banks make up about 20 percent of the company’s business.

“There’s more supply of bankers than demand for positions,” said Harry McCormick, a partner at the Hayden Group. “The only exception is in the technology area, Internet-related banking and e-commerce.”

McCormick knows a number of bankers who have left Massachusetts to seek opportunities along the Eastern seaboard.

“In general it has been difficult for a lot of bankers to find opportunities here,” he said.

Many people displaced in the merger of BankBoston and Fleet have found employment with Sovereign Bank, which will open its eastern Massachusetts branches June 16. Sovereign will open branches in central and western Massachusetts on July 21. Just as customers that will be moved to Sovereign Bank wonder what the bank will be like, so do the employees that will be shifted from Fleet and BankBoston to the Pennsylvania bank.

“Whether those people who are moving to Sovereign are going to stay there or not is really still up in the air,” Greene said. “Many of them want to leave Fleet, but the grass always looks greener and it isn’t always.”

Small Bank Alternative
The low unemployment level has made it harder to hire entry-level bank workers, and there is a great demand for employees at smaller banks, he said. Greene’s firm works with banks from about $500 million to $2 billion in assets to find and place senior executives.

Community banks often try to take advantage of changes in the marketplace by hiring experienced bankers. There is the potential for a great deal of turnover with the merger of Fleet and BankBoston, Citizens’ acquisition of USTrust and State Street’s retail bank, and the entry of Sovereign Bank into the region.

Boston-based Capital Crossing Bank, which has $750 million in assets, hired another former CEO of USTrust, James V. Sidell, to head a new relationship banking division geared to entrepreneurs. Along with Sidell, the bank hired several other USTrust employees with experience in cash management and commercial lending.

But according to the local headhunters, it is often difficult to place employees from larger banks at smaller institutions because of cultural differences or high levels of specialization.

“The problem is that many of these people, certainly the majority if not more, don’t necessarily fit the smaller banks in the jobs that the smaller banks are seeking,” Greene said.

A foreign exchange specialist at one of the bigger banks will not be as valuable to a community bank on the North Shore as a community lender who works with similar transactions, he said.

Competition to hire talented bankers is so strong that it may result in a bidding war. Greene recently spoke with a community banker trying to hire an employee for a credit position. The banker offered the job to two successive people, and both returned with counteroffers from their employers.

“In both cases they accepted the counteroffer and didn’t go to the new bank,” Greene said. “Money talks.”

While soliciting counteroffers may have been frowned upon in the past, people have become used to it as workers have less loyalty to their firms, he said.

Mergers often result in job cuts because of overlapping positions. Acquiring banks typically like to keep employees that develop new business and track portfolios, but may not keep team leaders or group managers. But companies also see many employees leave as much as a year or two after the merger because of changes in the company, Greene said.

“There are lots of reasons people move,” Greene said. “One of the bigger ones is ‘Who am I working for? Who is my boss and my boss’s boss? And is the new environment as good to work in as the old situation?'”

High-Tech Lures Bankers Out of Shrinking Industry

by Banker & Tradesman time to read: 3 min