Deirdre McMurdy

Well, this should all be very interesting.

Scotiabank has just ponied up $3.1 billion to acquire ING Bank of Canada. It's the biggest acquisition of its 180-year history and one of a series of deals the bank has closed to increase its bulk and expand its range.

There was no shortage of tire-kickers for ING Canada, which was being sold by its Dutch parent because of home-office constraints related to the European debt crisis. It's got a nice amount of cash on its balance sheet — enough to bring Scotiabank's cost down to a mere $1.8 billion — and it has 1.8 million customers.

The customers are the real value in a mature domestic banking market. Scotiabank's challenge is to retain the deposits of the existing base while attempting to sell other Scotia products — like mutual funds — to them.

The thing is that the ING crowd is a very distinct one. They've all shifted to ING because of its self-positioning as a no-fee, Internet-based alternative that offers higher interest rates than the Big Six.

Right out of the gate, Scotiabank CEO Rick Waugh has declared that he will not mess with the ING model and its "unique platform." That's as important a statement as it's likely to be an untrue one.

The hard line that nothing will change is likely to soften considerably in 18 months. That's when the re-branding of ING will begin and, inevitably, it will be fully incorporated into Scotiabank. After all, there have to be efficiencies and appreciable economies of scale to make the acquisition pay off as quickly as possible. All the more because the bank is issuing new shares to help cover the cost — and that could dilute and antagonize existing shareholders very quickly.

    In the retail business, it can sometimes work to preserve an independent boutique brand after it's been acquired by a multinational behemoth. Estee Lauder owns MAC Cosmetics, Aveda and Bobbi Brown — along with their loyal customers. And Ben and Jerry's is no longer a small, Vermont-based ice cream maker — it's wholly owned by Unilever. The organic tea company, Celestial Seasonings, was owned by Kraft before being sold to the Hain group of companies.

    You get the drift.

    But it's not quite the same in the world of highly regulated financial institutions. It's not like Pepsi owning Taco Bell. Not even a little bit.

    Furthermore, Scotiabank's record on acquisitions in the wealth management sector suggests it's all about integration.