BB&T and SunTrust, the two largest regional banks in the southeastern U.S., are in the process of merging. They’re almost exactly equal in size, with $228 billion and $220 billion in assets, respectively. And while most bank mergers involve one brand swallowing another, this time the two banks are taking pains to demonstrate that their merger is a merger of equals.
So, for example, the new bank will have its headquarters physically in between the existing banks’ existing headquarters. BB&T is based in Winston-Salem, North Carolina, and SunTrust is based in Atlanta, but the merged bank will be headquartered in Charlotte, North Carolina.
And the new bank with the new headquarters will have a new name: Truist Bank. “Truist” is not a typo, even though your iPhone will tell you it is one.
“The two companies partnered with Interbrand, a global brand consultancy, to lead in the development of the new name and brand identity,” bragged a press release from the soon-to-be-Truist banks. “The rigorous, data-driven brand development process prioritized input from BB&T associates, SunTrust teammates and clients. Through focus groups and analytical research, these stakeholders shared their expectations and aspirations for the new brand, which led to the name revealed today.”
They even released a video in which bank employees look genuinely eager about the process of developing their new, silly name. I almost feel bad making fun of it. But I do think they are making a business mistake.
What’s odd about inventing a brand-new name when merging two proud and equal institutions is that part of those institutions’ pride presumably arises because stakeholders in each place value in the existing brands. One hopes that existing BB&T and SunTrust customers feel good about the bank they bank with, on average, and that employees are proud to work where they do. (In situations where this is not the case, a merger can be a good opportunity to junk a damaged brand name in favor of a suitor’s.) Now, instead of having to get people associated with one bank used to a new name, they’ll have to do that at both banks.
CNBC has a story based on conversations with Wall Street analysts and investors, who doubly object to the choice of Truist: The merged bank will lose the value baked into both existing brands and will have to work hard and spend heavily to introduce customers to the new brand. It’s a pretty wasteful way to avoid the awkward choice of which brand to keep.
That said, I sort of get where they were going. The T in BB&T stands for Trust, so “trust” is the common bond between the merging brands. And customers surely want a bank they can trust. The new bank could have been “Trust Bank,” but a merging bank needs to make sure it has a name it can use in all the territories it might enter in the future, and in some places, that name is taken. One way to make sure you won’t get sued over your new trade name is to pick a name nobody else wanted. Hence, Truist.
And sometimes a merger really does call for a brand-new name. The name Verizon was made up for post-merger Bell Atlantic after it acquired GTE in 2000. At the time, the company explained the new brand name was a portmanteau: “‘Veritas,’ connoting certainty and reliability, and ‘horizon,’ signifying forward-looking and visionary.” I’m sure this would have been roundly mocked on Twitter if Twitter had existed at the time. But now, Verizon is just part of the landscape: highly recognizable, closely associated with telecommunications, non-ridiculous.
Still, in that instance, there was a specific reason to invent a new name. Bell Atlantic operated entirely on the eastern seaboard. It was acquiring GTE, whose geographic territory extended as far as Hawaii. The company needed a new name that didn’t imply regionality, and the GTE brand was a bit old and fusty. Hence, Verizon. (Around the same time, Southwestern Bell Corporation had been buying up phone companies far from the Southwest; its solution was to rename itself SBC Communications, then eventually to buy AT&T and rename itself AT&T.)
“Truist” feels less like the Verizon case and more like when AOL and Yahoo! were combined; to avoid privileging one brand over the other, the merged AOL-Yahoo! entity was called Oath, to much mockery. It never caught on. This year, Oath’s parent company dropped the Oath brand in favor of one that uses the parent’s better-liked name: Verizon Media Group.
The Bank Soon to Be Known As Truist doesn’t even have visual branding yet to share with employees, customers, or the public. So maybe it’s not too late to change course. If they think both brands are about equally good, maybe they could decide which one to keep by tossing a coin.