Sometimes an acquisition pays off in expected ways.

Chemical Financial bought Talmer Bancorp last fall in a deal touted as a way to gain scale as the Midland, Mich., company crossed a key regulatory threshold.

The $17.6 billion-asset company is discovering how fortunate it was to keep Talmer’s top executives following an unexpected retirement announcement from David Ramaker, its longtime president and CEO. The timing is even more surprising; Ramaker plans to step down within the next three months.

The decision caught many at Chemical off guard, but the board resolved the succession issue quickly by appointing David Provost, Talmer’s former CEO, to lead the company. Thomas Shafer, another Talmer executive, will run Chemical’s bank.

“There had been discussions with the board, but the timing [of the retirement] was a bit of a surprise,” said Dennis Klaeser, Chemical’s chief financial officer.

Ramaker did not respond to a request for comment.

The decision highlights how an acquirer can benefit from keeping a seller’s CEO. The move is a departure from pre-crisis consolidation, when a selling CEO often left soon after a deal was completed.

“More people have figured out how important it is to keep these people,” said Terry Turner, president and CEO of Pinnacle Financial Partners in Nashville, Tenn. Pinnacle has a history of retaining CEOs from the banks it buys, including Rick Callicutt at BNC Bancorp, who is running the company’s operations in the Carolinas.

"If you keep the people in place you keep their clients and the revenue,” Turner said. “In the 1990s it was about how many expenses you could take out to meet the numbers. People lost so much revenue and it led to flawed acquisitions.”

Though Chemical’s executives are keeping tight-lipped about the reasons for Ramaker’s retirement, some industry experts said the speedy timeline indicates that the subject was likely covered during negotiations with Talmer. Provost became Chemical’s vice chairman after Talmer was bought.

“There was maybe more discussion and consideration of alternatives that went on that you didn’t hear about and that aren’t likely to go public,” said Rod Taylor, president of Taylor Mead Management Consultants and Executive Recruiters in Atlanta. “It’s not something people want to reveal. If you let the competition know you have a succession issue you are making your bank a target.”

While the announcement may have caught investors flat-footed, the shakeup could serve Chemical well over the long run, industry experts said.

“This is like losing LeBron James and bringing in Stephen Curry to replace him,” said John Donnelly, a managing director at Donnelly Penman & Partners, an investment bank in Grosse Point, Mich. Donnelly also said he was surprised by the timing of Ramaker's retirement.

“In the limited time we had spent with them during their days at Talmer, we found the team very, very impressive,” Scott Siefers, an analyst at Sandler O’Neill, wrote in a note to clients. “They came across as clear [and] logical thinkers, and we sensed a results- and accountability-driven culture.”

During Ramaker’s 15-year tenure as Chemical’s CEO, the company grew from a little-known community bank with about $2 billion of assets to a significant regional player in Michigan and adjoining states.

Of course, there are always risks when a major change is made at the top, especially when a bank promotes executives from another institution.

Regions Financial in Birmingham, Ala., learned that lesson in 2006 when it named Dowd Ritter as its CEO. Ritter had been CEO at AmSouth Bancorp., an institution Regions had just acquired. Several high-level Regions executives, including future First Horizon CEO Bryan Jordan, left in the wake of Ritter’s appointment.

Grayson Hall, another former AmSouth executive, is Regions’ CEO.

There are no early indications that Chemical executives, including Klaeser and Chief Operating Officer Len Amat, are planning to jump ship. At the same time, industry experts said, the management change is unlikely to slow Chemical down.

Provost, like Ramaker, is “one of the great CEOs to ever lead a Michigan bank,” Donnelly said.

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