Q&A with Matt Sosik, Hometown Bank
Photo/Christina H. Davis
Matt Sosik, President & CEO, Hometown Bank, Oxford
>> Why did the deal with Athol-Clinton Cooperative Bank make sense?
It makes financial sense because we essentially absorbed their assets and liabilities. For two mutual banks, as long as there is a positive difference between the two, you’ve got a winning situation. On the more practical side, the reason why we are out looking for those kinds of combinations is because there seems to be at least one bank on any viable street corner. The growth of bank branches has been prolific and it’s gotten to the point where branching opportunities, really viable good solid branching opportunities, are few and far between.
>> Athol-Clinton has a branch in Athol. Is that a bit of stretch geographically to bring under the Hometown Bank umbrella?
Twenty-five years ago that kind of distance could be a problem. But all those problems are solved today by technology. Where you lose a little bit is on the marketing and branding side. You have to create and recreate the brand the further away you get from your present sphere of influence. That’s something that we’re aware of and we will absolutely succeed at. When you know what the potential pitfall is, it’s fairly easy to fix it or make sure it doesn’t hurt you.
>> Would you expect that there are more acquisitions or mergers down the line for Hometown Bank?
Would we be interested in them? Yes. But they’re not easy to put together. Mainly for the same reasons I said they make sense. In the mutual world, the reason you still have so many mutual banks in the state of Massachusetts is because there actually isn’t an efficient market in which to trade them. That’s a good and a bad thing. Mutual banks are really a big part of what drives our economy in Massachusetts, so it’s a good thing, but you also need them to be financially healthy. We could probably use some more mergers and consolidation activity. It’ll come. There’s enormous pressure on banks right now.
>> What’s your perspective on the local economy as it stands right now?
Obviously, in the macro sense, a recovery is under way. But it’s just not happening on a local level. Here in Central Massachusetts, we have many self-employed people working in the housing and construction sectors, and the housing market is not doing well. There’s still a fair amount of foreclosure activity that needs to work its way through the system and until that does, there’s no upside to housing.
>> It seems like every bank is opening a branch in Worcester. Is that on your horizon, or are you happy to let other people do that?
We’re not happy to let other people do that — we’re resigned to let other people do that. For the folks that are there, that’s good for them. Worcester is the hub of our local economy, so in some ways if there were opportunities in Worcester, I would go there. But we didn’t get to that party in time and the punchbowl is kind of empty now. I think we’re okay to leave that market for others.
>> What’s the toughest management lesson you’ve had to learn?
One of the hardest things for me was understanding when you need to lay off and look the other way about the little stuff. Basically, it’s about not sweating the little things that people do that aren’t exactly the way you would want them done. When you try to squeeze all the juice out of the lemon, you really alienate people who are important to your organization.
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>> Are you seeing any particular industries that seem to be doing better than others?
There have been some industries that have recovered. Machining has recovered. The auto industry, from its depths of despair, has recovered. There's a big chunk of our local economy that's wrapped around the auto industry, so that recovery has helped.
>> How does Hometown Bank differentiate itself from other mutual banks in the state?
Well ultimately - unfortunately - banking is almost a commodity at this point. The only way for us to really differentiate is by providing something extra. And that something extra isn't just customer service. I'm talking about building sustainable relationships that are meaningful to our customers, that create loyalty and that create positive referrals.
>> Your first job out of college was as a bank examiner at the FDIC. What did you learn from that experience?
Probably the biggest thing I learned is that you cannot become a detached manager. Every loan, every asset and every liability decision that you make has an impact on your bank's financial position. You have to be super attentive. The bankers that I saw that ran into trouble - whether they were small banks or medium-sized banks - got there because management was inattentive.
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