Saturday, April 21, 2012

Banker Quotes: As Told to Me v3

I learn a lot from bankers as I visit their offices, speak to them on the phone or at industry events. Occasionally they will offer an insight that I think my Twitter followers would find interesting. Since I estimate my Twitter community only reads about 10% of their tweet stream, and so many of my blog readers do not follow Twitter, below are selected quotes that I tweeted so far this year.

Note that if the quotes exceeded 140 characters, I would have abbreviated or substituted some words to make them fit. So if you are a CPA and want to count, a few of the quotes may exceed the 140 here, but not on Twitter. I quote bankers anonymously to protect the innocent.


@JeffMarsico Bank head of branches: "All I need is time to sell, new shoes, and business cards."

jfb note: There are a lot of vendors out there selling the newest sales widget. But when it gets down to it, this banker gets to the heart of the matter. While typing this post, my bank called me from the local branch to tell me about their home equity lines! Third time my bank has called me in 16 years. Progress! But read the next quote.

@JeffMarsico Bank CEO: "People work at banks because they don't like to sell. It's how it has always been and still is."


jfb note: I think it is changing, though.



@JeffMarsico Bank Chief Risk Officer: "Not sure if ERM (enterprise-wide risk mgt) is theory or theology."

jfb note: Surprised that this came from the Chief Risk Officer because they are usually preaching the virtues of checking on the checkers that are checking on revenue generating bank activity. See my comments on ERM here.


@JeffMarsico Gas station attendant on free windshield inspection: "Sir your windshield looks great. To keep it that way, avoid highways."

jfb note: Ok, this has nothing to do with banking. But, seriously, this was his advice.


@JeffMarsico Bank analyst: "If there are such great returns to scale, then where are the Citigroup Inc. shareholders' yachts?"

jfb note: This was in a research note and not told to me directly. The economies of scale gang still can't answer this one. But a colleague of mine dubbed it "diseconomies of scale due to organizational complexity". I say I could have wiped out just as much shareholder value as Citigroup's Charles Prince for far less money.


@JeffMarsico Credit Union CEO: "The differences between CUs & community banks are inflated by trade groups. We should focus on big banks."

jfb note: This was told to me at a conference that was designed specifically to lobby the Federal government with the key issue being expanding CUs business lending. But, with the sum total of assets in CUs being less than JPMorgan Chase, it should make us wonder where community FIs should spend their energy. And don't count on your trade association to help you to target their largest contributors.


@JeffMarsico Bank exec: "If our regulator walked by our water cooler & saw that it was half full, they would write us up for it."

jfb note: Symbolic of the relationship between examiners and examined.


@JeffMarsico Branch banking exec: "We need to figure out how to give good service to rate sensitive customers & Nordstrom service to those that value it."

jfb note: Banks still struggle with the squeaky wheel philosophy of customer service... give the greatest service to those that make the most noise or are the most visible, versus those that are the most profitable.


@JeffMarsico Retiring Bank CEO: "I've been around (50 years) to see a few things. I've never seen an environment as difficult as this was for banks."

jfb note: Enough said.


@JeffMarsico Bank CEO: "If I don't know within 30 minutes of meeting w the borrower if the loan is a good one, I'm in the wrong business."

jfb note: I hope he meant in the context of the next quote.


@JeffMarsico Bank director on strategy: "I would like to make loans to borrowers that can pay us back."

jfb note: I agree with this strategy.


@JeffMarsico Bank director: "A great leader has empathy, sympathy, integrity, and consistency."

jfb note: I was impressed that a bank experiencing difficulties would speak about leadership instead of regulators, borrowers, lenders, etc. It inspired this blog post.


@JeffMarsico Mortgage banking specialist to me: "FNMA has $25B of pending repurchase requests outstanding."

jfb note: Well that's not comforting. One of my clients received a significant repurchase request from Fannie. If we sell them, but have to retain the risk, pricing and terms are going to have to change on residential mortgages.


@JeffMarsico Bank CEO: "In my 40 year career, it's never been easier to book loans." 

This is one of those counter-quotes... quotes that go against conventional wisdom. This bank is feeding off the castaways from large banks. I hope the castaways can pay the loans back.


@JeffMarsico Community bank CEO: "I'm fm a big bank and I was surprised I had to make holiday decoration decisions."

jfb note: Welcome to community banking.


@JeffMarsico Bank institutional investor: "Great banks have 1. Great asset qual, 2. Good IRR position, 3. Great efficiency ratio, and 4. Great sales/service."

jfb note: Always great to know because institutional investors own a significantly greater portion of community banks now than pre-2008, which leads to the next quote.


@JeffMarsico Bank analyst: "Attractive banks: have a lending niche and/or in strong economy; managed credit problems well; & have excess capital."

jfb note: I suppose if you asked 10 analysts and institutional investors you would get 10 different answers.


@JeffMarsico Bank CEO: "In a perfect financial year, you have done well if you don't have to think about your bank more than 10 minutes."

jfb note: The context was that banks should make it easy for businesses to perform banking chores.


Bank CEO: "We would have to be much bigger than we are to be a technology leader."

jfb note: Some still believe they can be a technology leader.


Bank CEO: "Ally Bank did an excellent job convincing the public that the opposite of the truth is true."

jfb note: This was in response to me citing a survey that showed Ally Bank one of the top recognized bank brands. Advertising saturation can work for those with the wallets.


Bank CEO: "We were surprised at quick adoption rate of our mobile banking app."

jfb note: Because bank customers used to be notoriously slow at adopting new delivery channels. Needless to say the turtle is making gains on the hare.


Bank CFO to me: "You were able to pronounce that branch correctly when you didn't have that beard."

jfb note: Wise guy CFO.


What have bankers been telling you?

~ Jeff

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