Revolving Door: As Local Banking Market Shifts, So Does The Workforce
Photo/Courtesy
Deborah Larsen is one of many in Central Massachusetts financial professionals who have made the jump from large national banks to community banks.
When Deborah Larsen left her former post at a local Bank of America office to become senior vice president of commercial banking at Whitinsville-based UniBank for Savings last March, she said it was a bit of a culture shock.
Her second day on the job, Larsen said, she found herself peppering President James F. Paulhus with questions about where to find a pricing book and how to look up standard operating procedures for different questions she might face.
“He put his hand up and said ‘Stop,’” she remembers. “He said, ‘You’re an experienced banker. Do your business.’”
As the nation’s largest banks face the ongoing effects of the 2008 financial crash, some bankers are jumping ship for small community banks. And in some cases, they’re finding that the smaller setting provides a welcome change in the way they’re allowed to operate.
Downward Trickle
Players in the region’s banking industry say there hasn’t been a huge inflow of big-bank executives and staff into local community banks, but they say there does seem to be some movement in that direction.
Robert Reggiannini, managing director at Northeastern Banking Services Group LLC, a Connecticut-based consulting firm serving community banks, said controversy over the TARP bailouts and the jarring ups and downs in big banks’ fortunes in the last couple of years have made large institutions less appealing for employees.
“It’s a tough place to be,” he said, “And I think these [community] banks are benefiting from the turmoil in the market.”
Tom Grottke, president of NBSG, said that with many bigger banks not hiring much these days their mid-level executives might look at community banks’ openings as a way to move forward in their careers. He said making that jump has become easier in recent years because compensation at some large banks has fallen and some smaller banks are making more of an effort to offer competitive salaries.
Reggiannini, who was a senior vice president at Ware-based Country Bank for Savings before joining NBSG, said savvy smaller banks are imitating larger institutions in adding incentive-based compensation.
“I think that can further level the playing field,” he said.
Bank of America spokesman T.J. Crawford said the bank doesn’t comment on the specifics of employee retention, but it isn’t concerned about the number of employees going elsewhere.
“We have not seen any significant amount of departures from a company-wide perspective,” he said. “Certainly nothing to affect our staffing levels.”
New Directions
Regardless of the economic climate, Grottke said, community banks sometimes consciously decide to hire top executives from larger institutions because they want to grow a new business area, or grow the bank as a whole.
“Clearly, as the banks start to get over a billion [dollars in assets], there is much more added pressure,” he said. “CEOs and directors… look ahead and they say ‘Gee, we’ve got some good people and they work hard, but they really just don’t have the experience to handle 50 branches.’”
Larsen said that’s part of the story of how she ended up at Unibank. The bank hired James Paulhus, Bank of America’s former Central Massachusetts market president, as an executive vice president several years ago and promoted him to president in early 2009. Larsen said the bank saw Paulhus as someone with the experience to get it into commercial lending.
In the year since he’s been president, Larsen said, Paulhus has hired several executives from large banks.
By the time she got the opportunity, Larsen said she was ready to leave Bank of America.
She had started her career in Worcester at the Bank of New England’s Worcester County subsidiary. After a few years, she moved to the First National Bank of Boston, which later merged with Fleet. Through all the changes, she said, the local bank offices retained their own leadership and could largely create their own business strategies.
But when Bank of America acquired Fleet in 2004, Larsen said, the model changed. Instead of working as part of a regional team, employees were grouped by business function, reporting to supervisors in different offices.
“The people you were sitting next to didn’t even report to the same people anymore,” she said.
At Webster Five, Virginia McDonald, senior vice president and director of human resources, said the bank has hired a few officer-level employees from large banks in recent years.
“We have had an opportunity, probably, because of the economy,” she said, “But we also hear from the people who are applying here that they like the idea of working for a smaller organization where they can know everyone.”
Well Prepared
From the bank’s perspective, McDonald and Larsen said, a big advantage to hiring staff from larger institutions is the training they’re almost certain to have gotten. Larsen said most large banks want to make sure all their employees are trained to do things in very specific ways, and finding a banker with that type of background can be appealing to clients.
“When we want to train people here [at UniBank], either it’s like you get attached to my hip… or we have to send you someplace,” she said.
Savers Bank of Southbridge recently hired two former employees from Sovereign Bank, which is one of the largest banks in the Northeast and a subsidiary of Spain’s Santander Group.
Chris Martin, Savers’ COO, said the bank isn’t making any particular effort to hire people with large bank experience.
“We had openings, and they applied,” he said. “I wouldn’t necessarily say that we targeted bigger institutions.”
Martin said new hires from large banks tend to have useful knowledge and training, but they may need to shift their approach to drumming up business.
Where large banks have their employees on the phone two or three nights a week with their customers, Savers may make that sort of calls once or twice a month, he said.
That goes back to the question of culture. Reggiannini said community banks need to be cautious when they hire staff from larger institutions to avoid damaging their ties to the local communities where they do business.
Larsen said the business she’s been able to bring to UniBank since she’s been there isn’t as much a matter of her experience at larger institutions as her local connections. Even when she worked for big banks, she was involved with the local chamber of commerce, the YMCA and other community institutions, and that’s where many of her leads have come from, she said.
The culture of community banks can also make them more pleasant places to be, Larsen said. And the quality of the work environment keeps people around. She said a number of her coworkers have been at the bank for 40 years.
WBJ Web Partners
Most Recent
Most Recent
0 Comments