Mergers and acquisitions require attention on every front…all at the same time.

Legal teams are managing the close, operations departments are mapping integration, and leadership is explaining the situation to shareholders, lenders, and employees. In that environment, banking relationships feel like one of the more stable variables. They tend not to be.

The fees you are paying, the structures you inherited, and the relationships you are depending on can shift significantly across the arc of a transaction. Companies that treat banking as a background item during post-merger integration often discover the cost of that decision years later, in a recurring line item that has been running unchecked since the deal closed.

The timeline matters. What you do before the deal, in the first six months after close, and in months six through twelve are three distinct conversations with different risks and different responses.

Before the Deal Closes: Protect the Relationships You Have

Due diligence in M&A scrutinizes the absolute requirements to hit the target: the balance sheet, contracts, operations, and personnel. Banking relationships rarely receive the same review, and that gap creates real exposure.

When a company is acquired, the acquiring entity brings its own banking structure. The target company’s existing banks, which may have been central partners for years, find themselves in a different position almost immediately. A bank holding 30 percent of your total cash management flows before the transaction may hold 10 percent or less after it, simply because the combined entity is larger and the new owner may have its own established relationships that it wants to preserve and grow.

“Before the merger, that bank was one of your key partners. After the merger, it is no longer among your core banks, as its share has been diluted. It’s important to maintain the current banking relationships as well as involving the acquired banking relationships to ensure that each bank is treated fairly. ”

– Pauline Lion, Director, Redbridge

That outcome is avoidable, but only with communication. Banks that feel unrecognized after a transaction as part of the banking network of an acquired entity can become less competitive on pricing, less engaged on service, and in more significant cases, less willing to extend credit or maintain existing terms. That shift rarely announces itself. It shows up gradually in how they respond, what they offer, and eventually what they are willing to finance.

The pre-close phase is a fact-finding mission. The goal is to understand every banking relationship inside the target company: who they are, what they provide, what the terms look like, and what the relationship means operationally. Letters of credit, daylight overdraft lines, and local clearing arrangements are the kinds of details that surface problems before they become disruptions.

Your own banks deserve the same attention. Letting key partners know (depending on timing and ability to release information) a transaction is in process, and that their relationship will be part of the evaluation going forward, tends to keep financing relationships stable through a period of significant change.

If you are heading into a transaction and want an independent view of your current bank fee structure before the complexity multiplies, a bank fee benchmarking engagement can establish a clear baseline now.

The Months One Through Six: Observation Is a Strategy, Not a Delay

The most common mistake in the first months after close is moving too fast on adjusting, eliminating, and consolidating the banking structure and relationships. The second is moving too slowly on the monitoring that should begin immediately.

Nothing about the account structure should change right away. The books are still being consolidated. Financial statements are under scrutiny from shareholders and lenders. Debt covenants are being monitored. Receivables need to flow cleanly. Any disruption to payment infrastructure during this period carries consequences well beyond treasury.

The standard observation period in post-merger integration runs six to twelve months for good reason. The four to five months immediately following close are typically consumed by financial consolidation, and until that work is complete, the full picture of what you are working with is not yet visible.

During this window, the treasury team needs to dedicate time to learning the other company’s treasury and cash management approach, as well as the way it has utilized banks. How do the acquired entity’s banking relationships function in practice? What does reporting look like across the combined structure? What does pricing actually show when you put the two entities side by side?

Fee monitoring is a different matter and should not wait. The acquired entity may be operating on pricing negotiated years ago, for a company of a different size, under conditions that no longer exist. That pricing does not automatically adjust because ownership changed. It keeps running until someone scrutinizes and analyses it.

HawkeyeBSB gives treasury teams visibility into what they are being charged across every entity and banking relationship on a monthly basis. Waiting until month six to establish that visibility means six months of fees that were never reviewed and bank billing errors that were not caught. These fees are paid and are likely unrecoverable.

Months Six Through Twelve: Bank Rationalization and the Decisions That Define the Structure

By month six , the post-merger integration conversation shifts. The books are cleaner. Leadership has a clearer view of the combined business. The questions become harder and more consequential.

The core questions related to bank relationships and associated services and fees are straightforward: which relationships serve the combined organization, and which ones are duplicative? Fee structures misaligned with current volumes tend to answer that question on their own.

Consolidating banking relationships is rarely a simple reduction exercise. A bank providing a financing facility, a revolving credit line, or favorable terms on letters of credit holds value that a fee analysis alone will not capture. Treasury integration decisions have to weigh capabilities and credit relationships alongside pricing, and the right answer often involves keeping relationships that might look redundant on paper.

Where two banks have similar capabilities and neither holds a distinct financing advantage, putting them into direct competition tends to produce better outcomes than quiet deference. Full transparency about the scope of the relationship, and what winning it means going forward, creates the conditions for pricing that reflects the combined entity’s actual leverage. Banks respond to specificity, and this is the moment to provide it.

Imagine this:

The combined entity is also a different credit story than either predecessor was alone. A larger balance sheet and greater flow volumes are real negotiating assets, and treasury teams that enter this window with current market benchmarks are in a far stronger position than those relying on pricing set before the transaction closed. Bank fee benchmarking at this stage is negotiating infrastructure.

Deferring these decisions does not preserve optionality. Each quarter that the combined entity operates on unexamined fee structures from legacy banking arrangements, the cost compounds. Cash management fees are recurring, and unexamined price reduction opportunities that have not yet been optimized for either company will not automatically correct themselves over time.

If your organization has been through a transaction in the last one to three years and has not yet conducted a formal review of your banking structure and fees, an independent assessment gives you the data to make that decision clearly.

The Cost That Never Announces Itself

There is a pattern that repeats across M&A activity.

“Cash management falls last on the list of everything, whether it is an established company or an M&A. By the time anyone starts looking at cash management fees, they have already cut costs everywhere else.”

– Sara Moren, Associate Director, Redbridge

Treasury teams are not careless. It is exactly the opposite! Each treasury team is overworked and understaffed in a normal workplace. These resources become stretched even more during and after an M&A event. Everything else simply demands attention first: integration, systems consolidation, policy harmonization, financial reporting. By the time cash management fees come into focus, the combined entity may have been operating on mismatched, unreviewed pricing for a year or more.

The problem compounds because those fees are monthly. Every month without a review is a month of recurring expense that did not have to be there. It is no different from an airplane taking off with empty seats – these are revenue generating opportunities that can not be reclaimed.

Redbridge worked recently with a multinational operating company that had maintained tightly managed bank fees on its own operations for years. When it acquired a large subsidiary, that entity came with its own banking relationships and its own pricing, negotiated under entirely different conditions and never updated to reflect the new parent’s scale or leverage. The gap between what the subsidiary was paying and what market conditions warranted was significant. It had simply been running, unnoticed, since the close.

That is not an unusual story. The savings in situations like this are not theoretical. They are the difference between pricing that reflects current market conditions and pricing that reflects a relationship no one has revisited in years. Fee structures are often maintained by default rather than active reassessment. Introducing greater visibility and transparency, supported by well-defined agreements, can create opportunities to enhance both efficiency and the overall banking partnership.

Redbridge helps treasury teams navigate bank fee management and bank rationalization at every stage of a transaction, backed by decades of data across hundreds of corporate banking relationships. If your organization has recently completed a transaction, or is currently working through one, we should talk.