Paul Murphy, whose Houston bank sold itself to Zions Bancorp. of Salt Lake City in December, knows firsthand the risks of acquisitions.
At a Zions investor day last week, Mr. Murphy said that before the sale, Amegy Bancorp Inc. made six acquisitions of its own - and not without some nerve-racking moments.
He gave the audience a feel for the risks by recounting one of his favorite deal integration stories.
When his company (then called Southwest Bancorp. of Texas Inc.) bought Maxim Financial Holdings Inc. in 2003, an auto dealership "informed us that they were very nervous" about losing MaximBank, the bank it had done business with for 30 years, he said. "We spent a little extra time with them, assured them nothing was going to change, and did the conversion over one weekend.
"One of the mechanics from the dealership came into the bank Monday morning to cash a check, and the bank said, 'You don't have any money. Sorry, can't cash your check.' The mechanic came back to the dealership and found the owner, who called, very upset. 'I can't believe it. This is my worst nightmare. What happened?' "
It turned out that the mechanic had walked into the wrong institution entirely - Guaranty Bank, not Southwest. Mr. Murphy said the lesson of the story as it relates to the Zions-Amegy deal is, "We understand. We've lived it, people are on edge - employees, customers ask, 'What does this mean to me?' … And I think we have a good idea of how to manage that."
