Photo courtesy of Mutual Bancorp
Matthew Burke
CEO, Mutual Bancorp and CEO, Cape Cod 5
Age: 45
Industry experience: 20 years
With its pending acquisition of Raynham-based Bluestone Bank, Hyannis-based Mutual Bancorp will become the largest mutual holding company in Massachusetts rivaling the size to some of the state’s larger stock banks.
But instead of traditional merger and acquisition deals, the holding company is set up as a long-term partnership, says CEO Matthew Burke, that sees unique bank brands remain active, instead of falling under the weight of a single member organization’s brand. That’s being buttressed by Bluestone Bank President and CEO Meg McIsaac’s appointment as co-president of the holding company and vice chair of its board.
The soon-to-be $8.8 billion-asset holding company currently includes Hyannis-based Cape Cod 5 and Leominster-based Fidelity Bank.
Q: What stood out about Bluestone Bank’s organization that attracted you to the merger?
A: It all starts with alignment of culture and values and really why we exist as mutual, community banks. I have a pretty good understanding of what we would be getting with Bluestone in terms of just quality people, their leadership, their board and just that natural fit. These mutual bank partnerships are very unlike any type of public bank M&A. It is all about the fit. Nobody’s buying anyone. That’s why we call it a partnership and it has to work for both sides.
For us, being about 18 months into this now with Fidelity Bank, and having created this model between Cape Cod 5 and Fidelity Bank, we have a pretty accurate picture of what it is. So that’s really helpful for Bluestone to be able to see what we built, the journey we’re going down.
They’re excited about it, and we’re excited about having them as a partner, You can look at numbers. You can do all the technical due diligence, all the things that you have to do but I think that’s the part that’s a little bit more difficult to measure, but is the most important part, you know, that cultural fit between the two organizations.
Q: What do you think is valuable about these mutual holding company combinations?
A: You’re able to keep everything that is special about these individual banks in terms of serving the community – the hyper-local nature of it – and able to retain that while making a needed evolution in terms of the need for scale. In our industry, you’ve seen a lot of consolidation. Like many other industries, [banking has] gotten more difficult. It’s gotten more expensive, the regulatory landscape and just the cost of talent, the cost of technology. One of the things that we share, and one of the things you see other banks going down this road of partnership, is we don’t want to have to cut our investment in our people, our investment in technology. We want to be able to continue to grow and have the scale necessary to be successful, be financially strong, be diverse in terms of our exposures to different markets.
Q: How will becoming the larges mutual holding company in Massachusetts enable stronger competition?
A: Ultimately, that’s the benefit, certainly for all three banks. Whether it was Fidelity or Bluestone, just having the depth of talent – whether it’s a succession, whether it’s to not have single points of failure, to have depth and leadership, to have these other areas where it’s more difficult to have to really focus resources. Whether it’s initiatives like data, artificial intelligence, things like that. To be able to leverage our resources, to be able to put the strength of a $9 billion organization behind a $1.5 billion bank, it just gives you that much more strength, that many more resources, that much more ability to react to different things that are happening around us. We know we need to compete with banks that are much bigger than us and have much bigger budgets from a technology standpoint. So, to be able to continue to and even really accelerate our investments in technology, and upgrading our technology, that’s critical.
Q: Talking about the investment in people, Meg McIsaac will be becoming co-president and vice chair of the board. What’s the value in having a co-president?
A: Meg makes a big part of why we feel good about this partnership: Meg’s leadership, our ability to work together on a day-to-day basis. That’s one of these things with what we’re building, it really requires two CEOs that can work together daily, in terms of bringing people together. Particularly those first couple years, it’s really critical to have two CEOs that can really bring the organizations together as one organization. That’s something that I feel really good about with respect to Meg and having someone else that has really a ton of valuable industry knowledge, has been in this industry for a long time. The way that Meg leads is very similar to the way that we lead here: a really collaborative leadership style, no silos, keeping everyone engaged and understanding the “why.”
Q: Where do you think the industry might be leaning in terms of these partnerships?
A: That’s where mutuals and public stock banks are probably a little bit different. I think for public stock banks, you’ll continue to see more traditional M&A at the bank level. I think for mutuals, you’ll continue to see probably more holding company partnerships and I think that’s a pretty attractive option if you can find the right partnership and the right organization to be a part of, where you can really retain what’s important. Maybe for some smaller banks, you’ll see potential bank-level mergers, but there really haven’t been too many. It’s been more these partnerships that will continue to be a trend.
Burke’s Five Favorite Restaurants
- Bricco – North End
- Bluefish River Tavern – Duxbury
- Tosca – Hingham
- Lobster Trap – Bourne
- Rye Tavern – Plymouth
