Summary List Placement
The COVID-19 pandemic has left banks large and small racing to upgrade their digital capabilities as customer demand for seamless, online mobile banking has only grown.
It’s also illustrated the benefits of scale for financial firms as interest rates remain near-rock bottom levels. Some have turned to M&A to bulk up, leading to a resurgence of dealmaking.
M&T Bank is among those firms, announcing in February plans to acquire People’s United Financial in a $7.6 billion, all-stock deal that expands the scope of the banks’ geographic footprint across much of New York and the mid-Atlantic region.
Now, the bank is turning towards its home base of Buffalo to develop the technology and talent that it says is needed to keep pace with some of its biggest competitors.
On Wednesday, the bank unveiled its new, nearly $58 million tech hub in Buffalo — a 330,000 square-foot space across 13 floors of the 38-story Seneca One building in the city’s downtown neighborhood.
The new office launch comes in the midst of M&T’s three-year journey towards more agile, customer-driven tech development that will help the bank roll out more digital tools for its users.
“The pandemic accelerated digital adoption, and technologists will be able to provide digital solutions that will make a difference in our customer’s lives. We realize it’s a race for relevance and need to create an environment, to be competitive, that attracts modern, creative talent,” M&T Bank Chairman and CEO René Jones told Insider via e-mail.
M&T Bank Chief Information Officer Michael Wisler told Insider the opening of the site is a marker in the sand both for M&T and the city of Buffalo.
“We’ve got that size to be big enough to be relevant, but I also think that we’re small enough to be nimble. And I think you can say that of M&T as well as you could about Buffalo,” Wisler said in an interview.
M&T has more than $150 billion in assets, as of the first quarter of this year, and a base of nearly 700 branches across New York and the mid-Atlantic.
Competition for tech talent
With the launch of the tech site comes the opportunity to attract new tech talent in the region. M&T has already brought on more than 400 experienced tech workers and 120 college grads. It ultimately plans to hire more than 1,000 technology specialists over the next three to five years at the Buffalo site.
M&T counts more than 18,000 employees across the bank, 2,000 of whom work in technology, Wisler said.
Smaller banks, from community to mid-sized and regional, face some of the most fierce competition for talent in recent memory as the COVID-19 pandemic spurs investments in digital growth.
“We believe that cities like Buffalo, regions like western New York, are essentially in a race for relevance. And that relevance is for talent. Not just pure software engineers, but creative class talent, not just problem solvers, but problem finders. And you have to create ecosystems that send the right signals and are designed for the right outcomes,” Wisler said.
Wisler said that M&T remains confident it will be able to attract and retain employees at its new site, especially in part since the pandemic has caused a wholesale re-evaluation of the merits of living in big, urban tech centers like New York and the San Francisco Bay Area.
“There’s plenty of talent that’s sitting in a 1,200 square-foot apartment in New York thinking ‘If I can’t go to that 40 story, 15,000-person office space, might I go here?'” Wisler said.
In December, meanwhile, M&T and a coalition of partners launched the Western New York Tech Skills Initiative, a set of virtual tech and skills training courses, “in response to persistent unemployment and underemployment exacerbated by the pandemic,” the bank said at the time.
A tech pivot at M&T
Wisler described a shift in M&T’s approach to tech research and development since he joined the bank in 2018 from Capital One, a company he had joined “when it was still a startup” and where he ultimately served as a managing vice president heading North American credit-card technology.
“I count myself incredibly lucky just to have been just grown up professionally in an environment that had that reverence for tech data testing and innovation,” Wisler said.
That experience has informed his strategy at M&T, where the bank has pivoted “over the past three years to a completely scaled up, agile factory, customer-driven design” process, Wisler said. M&T is engineering cloud-native solutions in areas across the bank, Wisler said, and has also begun deploying blockchain tech for usage around asset-backed securities.
To that end, M&T has partnered with some of the fastest-growing fintechs in banking, including digital-lending provider Blend. It’s also launched startups internally like Nota, a digital banking service for lawyers, and Climb, a small-business valuation tool that Wisler said is currently in a beta-testing period, both operated by M&T.