It seemed Westpac’s $1.5 billion purchase of the Bank of Melbourne in 1997 was made after learning from the expensive mistakes CBA made in taking over Victoria’s State Bank in 1991 – or perhaps that should be, rescuing the State Bank.

The aggressive rebranding of the State Bank saw customers leave in droves, many of them going to the Bank of Melbourne. An AFR story today says 10,000 customers a month were marching out the CBA/State doors.

Westpac went softly softly, initially turning its Victorian operations over to BoM. The acquisition lifted Westpac’s Victorian market share to 22%.

But the good work has been expensively undone. The 187 Bank of Melbourne branches were all rebranded with the red W last year and the AFR quotes Roy Morgan Research figures showing Westpac’s Victorian market share has fallen to 15.5%, losing a percentage point a year over the past four years.

It looks like Victorian bank customers just don’t like Sydney-headquartered banks. I blame the insularity of the sourthern football code.

Alternatively, the Morgan numbers confirm the rise and rise of the “community” part of banking. The Victorian market share winners over the past four years have been Bendigo Bank, ANZ and St George.

Bendigo and St George trade on not being “big banks” while ANZ was the first of the big four to launch a customer satisfaction campaign, opening instead of closing branches.

There’s still money to be made in being nicer to people than the opposition are.