When New York Community Bancorp conducted a nationwide survey to determine which bank brands appeal to consumers, the Long Island-based company did not fare well. In fact, the New York Community name finished dead last.
After the firm's $2.6 billion merger with Flagstar Bank in December, company executives knew that the time had come to do business under a new brand.
They ultimately selected Flagstar, choosing to become less regionally specific, CEO Thomas Cangemi said in an interview.
"New York means something different in the Midwest than it does for New Yorkers," he said.
Even before the Flagstar merger, New York Community had grown well beyond its home market in the New York City metro area. Over the last two decades, a series of acquisitions had increased its footprint to include Michigan, Ohio, Arizona, Florida and California.
The banks that will be rebranded as Flagstar include Queens County Savings Bank, Garden State Community Bank and three more community banks in the New York City metro area. The list also includes Desert Community Bank in Victorville, California, and Ohio Savings Bank in Cleveland. The holding company's name, New York Community Bancorp, will remain the same.
Earlier this week, the company unveiled a modernized Flagstar brand and logo that's meant to represent the nationwide expansion efforts of the combined banks, as well as the large portion of Signature Bank that New York Community purchased after the former bank's collapse in March.
Before settling on the Flagstar name, New York Community executives considered entirely new brands. But those options carried uncertainty about name recognition and market penetration, Cangemi said.
Flagstar Bank is a "neutral" but "patriotic" name that underscores New York Community's national expansion strategy, Cangemi said.
Particularly in the Midwest — Flagstar was previously headquartered in Troy, Michigan — the Flagstar brand has a "substantial amount of affinity to the consumer," he said.
Over the years, New York Community's approach of acquiring smaller banks and operating them under their original names meant that it did not have to invest in rebranding efforts, said Tim Davis, digital marketing manager at BankBound, an online marketing firm for the banking industry.
But now that online banking has become customers' preferred method of doing business, and an easy way for banks to expand, rebranding is "much more of a creative growth strategy," Davis said.
"In some consumer segments, there's less of an emphasis on a bank's history and story, and more of an emphasis on whether their product can do the job that's needed," he said. "Does the bank present itself as competent, reliable and cutting-edge?"
Cangemi said that even though some longtime customers of the legacy community banks in New York Community's portfolio might be disappointed by the rebranding, the company's people and culture are what really matter to consumers.
"When you think about high-touch community banking and personal client services, it's all about people," Cangemi said. "We're not changing the people. We're just changing the name behind the brand."
