Why 'WaFd'? To avoid being seen as a credit union
Washington Federal in Seattle had a minor identity crisis.
Ever since the bank shortened its name from Washington Federal Savings and Loan Association in 2011, it found that potential customers often assumed it was based in the nation’s capital or had ties to a government agency.
Moreover, because bank was not in its name, many assumed Washington Federal was not even a bank.
So now the bank is changing its name again, this time to WaFd Bank. (It is pronounced WAH-fed.)
“The word ‘federal’ tended to be associated with credit unions, so there was an immediate assumption that we were a credit union,” said Cathy Cooper, the executive vice president of retail banking at the $16.5 billion-asset WaFd. “We’ve been dying to get bank in our name since we switched charters in 2013.”
When the organization last rebranded, it was to better reflect its pending shift from a savings and loan association to a commercial bank.
This time around, executives wanted to come up with a name that was not so tied to geography. The word Washington can be a liability because some see it as synonymous with a political swamp that needs draining. Plus the bank operates in seven other states — Arizona, Idaho, New Mexico, Nevada, Oregon, Texas and Utah — and its leaders are hoping that a new name might play better outside of Washington.
The company, which has made at least a dozen out-of-state acquisitions since the late 1980s, has no immediate plans to move into new states but does want to bulk up in the markets it is in.
Rebranding can be a tricky business for banks. For one thing, it is tough to find a unique name and tougher still to find an existing word that has not already been trademarked. There is also the additional challenge of making it clear that the new name is the name of a financial institution and not, say, a pharmaceutical company.
Branding experts who spoke with American Banker said they were not crazy about WaFd Bank. In particular, they were hung up on the spelling and pronunciation — and its similarity to a certain large bank that failed spectacularly in 2008.
“I immediately thought of WaMu, Washington Mutual,” said Douglas Strickler, the CEO of the advertising firm Hot Inc.
He added that he would have liked to see the new name include fed instead of Fd, but acknowledged that might not have resolved the confusion with federal agencies.
“I’d perceive it as a missed opportunity,” added Steven Reider, president of the marketing and branch planning adviser Bancography. “I don’t like the fact that the pronunciation is not readily available. There’s no clear cue to the consumer as to how you pronounce this name, which I perceive as a negative.”
Still, a name is ultimately what an organization makes of it, experts say. If people looked askance at Columbus Bank & Trust in 1989 when the company changed its name to Synovus, a mashup of synergy and novus (Latin for new), nobody seems to remember that now.
And for all the flak BB&T and SunTrust took recently for choosing the name Truist for the combined company, nearly all of BB&T’s shareholders still approved the new name when asked to vote on it at a July meeting.
WaFd began the rebranding process about 18 months ago, Cooper said. Executives enlisted the help of a branding agency in Los Angeles and did test out some entirely new names before ultimately settling on WaFd. It was the bank’s ticker symbol for at least a decade, and the bank was already using the abbreviation in its email addresses and social media platforms.
Cooper said that so far, customers have largely welcomed the new name, possibly because many longtime customers were already calling the bank WAH-fed before the rebrand.
“If the reaction from our customers and the public is fairly mild but positive, that’s the best of all worlds,” Cooper said. “We want people to feel like it just fits, and it wasn’t a complete makeover.”