Northwestern-To-Chemical Bank Transition On Track

What’s yellow and black, soon to be green and white all over?

Bank leaders say Northwestern Bank’s conversion to Chemical Bank is on track for a likely August completion. Midland-based Chemical announced the purchase of Northwestern in March; as the closing of the deal now approaches, existing Northwestern employees know their futures, the Federal Reserve appears likely to approve the transaction, and a new future bank president has moved to town.

“We continue to press forward with the thought process that this is going to close the middle part of third quarter, with conversion before the end of the quarter,” says Chemical CEO David Ramaker.

Ramaker adds that both banks have been busy behind the scenes preparing for the change, but nothing can be finalized until the Federal Reserve gives its stamp of approval. The deal is very likely to be approved without a hitch, though early on it was anticipated that the Reserve might force Chemical to sell certain branches for competitive reasons.

“Because of the amount of competition today that comes from non-banks such as credit unions or mortgage companies, we have asked the Reserve to approve the deal without having to sell a location,” says Ramaker, “and we think it was heard.”

Throughout the past several weeks, Northwestern employees have been notified if they have jobs with the combined entity. Bank leaders have not said how many positions will be eliminated, though they have confirmed that all “customer facing Northwestern employees” will have jobs after the transaction.

One person with a big, new job is Donna McAvoy, Chemical senior vice president, who has relocated to Traverse City to lead the combined entity’s northern Michigan operations after the conversion. Though the announcement has not yet officially been made, the TCBN has learned McAvoy will lead the bank’s offices throughout the region from the current Northwestern main office on Garfield Avenue. Sources say current Northwestern CEO Daniel Terpsma will remain with the company in a different role.

Aside from the changeover from the iconic black and yellow Northwestern signs and “I Can Do That” branding to Chemical’s green and white logos, customers will likely see little change after the conversion.

“Customers will still walk into a branch or call and be serviced by the same individuals…still use their Northwestern checks, and make their payments as they always have,” Ramaker says. Customers will begin receiving more specific updates this month.

Ramaker and Terpsma said Northwestern customers will also soon be able to access certain products that Northwestern did not offer, including more robust commercial and industrial lending.

“We’ve always done some lending to manufacturers and industrial companies,” Terpsma explains, “but those are very capital intensive, and many loans were more than our size would have allowed us to lend them. [With Chemical] we can make larger loans and offer a broader array of commercial products and be more competitive.”

As conversion teams from both banks prepare for the merger of systems, leadership is also busy recruiting members for a new community board, something Chemical Bank maintains in each of its markets.