Question

When banks merge what are the impacts on overall staff members and computer systems?

Answer 1

When a merger happens, the acquirer often contemplates some synergy benefits.

The synergy benefits because of reduction in expenses, and increase in revenue because of the combined power.

Now for reducing the expenses, banks would often try to cut down on people cost, which is often a very high cost for a bank, as it is in service industry. Central Support Functions would be merged, and people who perform the similar tasks are often combined, and many of them are asked to leave the job. Even the systems are integrated, and redundant licenses are surrendered. Many of the legacy IT Systems are surrendered to cut costs and bring more efficiency.

On both the systems and people front, when a merger happens, some specific people and some specific tools are often requested, which creates new positions and system requirements.

Hence overall the People and IT Systems are reduced.