Banker Quotes As Told To Me v8

I learn a lot from bankers and industry experts 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 a fraction of their tweet stream, and so many of my blog readers do not follow Twitter, below are selected quotes that I tweeted since version 7.

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 people anonymously to protect the innocent.

1.  Bank CFO: The amount of money I hear over $10B banks spend prepping for CFPB exams is ridiculous.

Soon we will forget that the CFPB was established so that bankers don't take advantage of borrowers that lacked common sense. It is morphing into what many were predicting, a bureaucratic black hole that will provide no societal benefit, just cost.

2.  Bank CEO: Regulatory risk weights are BS. It takes me three years to foreclose on a house. I could repossess a car in a week.

States think they are protecting borrowers by making it difficult for lenders to foreclose on the homes of borrowers that stop paying their mortgage. Who pays the increased cost? Think about it.

3. Bank CFO: Our commercial line of credit utilization rate is in the low 40% range.

One of the reasons that loan growth is not robust in an economic recovery.

4. Bank head of HR: Lack of writing skills is an epidemic. How do these people get degrees?

I double checked my grammar on this post. No guarantees though.

5. Bank retail exec: Customers interact with our website more than they interact with all of our branches combined.

My marketing friends know this. But what to do about it?

6. Bank retail exec: Customer retention in our closed branches was somewhere in the 90's.

If you could keep 90% of your customers when you close a branch, I wonder what math justifies keeping the expense? Perhaps if the branch is growing in a vibrant market, it would make sense. But in a mature market with little branch growth? Hmmm.

7. Bank CEO: Lending has forever changed when the borrower took the position "yeah I borrowed the money but it's not my fault."

People speak of going bankrupt in casual conversation. It used to be embarrassing. When walking away from debts, somebody does pay. 

8. Bank chief risk officer: We want to do the right thing (re mortgages), but with more than 1,600 pages of regs, we're not sure what right is.

The complexity in the mortgage market was primarily driven by Uncle Sam. Uncle Sam is sending in the CFPB to fix it. Wonder how that will turn out?

9. Bank Chairman: There are no sacred cows except for the sacred cows.

Does self-interest slow down progress in community FIs?

10. Bank CEO: Moving forward, it's not business as usual, but business as planned.

So long as the plan works towards a competitive advantage.

11. Bank CEO: Your speech was good. Your wife is hot.

Was that faint praise for my speech?

12.  Me to bank exec: What do you do that you wish you didn't have to do? Exec: Talk to consultants. #ouch

It's the only way to end up in my blog.

13. Bank CEO: The more our bankers know how to run a bank, the more successful they will be because they understand the decisions made.

Communicating strategy through the ranks... what a great concept!

14. Bank director: A customer should have confidence that the banker sitting across the desk from them can get things done for them.

Are your bankers empowered to get things done for the customer? Or does a "no mistakes" unwritten policy make them call around the organization to make decisions?

15. Bank compliance officer to me: New lending regs have almost crippled us.

Didn't see that coming.

16. Bank CEO: Bigger isn't better. Better is better.

This CEO clearly needs to drink the investment bankers' Kool Aid.

17.  Me to bank director: I was so bad at picking bank stocks that my wife made me clear them through her. Director: And you're advising us?

Fair point.


What are you hearing out there?


~ Jeff

Banker Quotes: As Told to Me v7

I learn a lot from bankers and industry experts 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 since version 6.

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 people anonymously to protect the innocent.


1. Bank CEO: There was a time when everyone got a 3% raise no matter how well they did. I call them the union years.

It's difficult to motivate our people if we reward the average to below-average the same way as top performers. I also don't see a material difference between a 3% and a 4% raise. Do you?

2. Bank Director: Sales complaining about infrastructure is crap. Sales people have the tools. They don't have the disposition.

Sometimes reasons for not meeting expectations are excuses. Wisdom is knowing the difference between an obstacle and an excuse.


3. Bank CEO: If you throw a number out to our Board they'll swarm to it like piranha!

This is one reason why strategic plan projections look less like stretch goals and more like budgets. But if the bank places a present value on their strategic plan projections, should they be afraid of the answer?


4. Bank CFO to me: I believe the 30-year mortgage is unhedgeable.

What has the Federal Government done to the residential mortgage loan? They turned it into something imminently more complex than it needs to be from the borrowers perspective. And very difficult for bankers to put on their books. Without Uncle Sam's interference, I think a five-year, 30-year amortizing loan would be the norm, and everyone would understand it, and the cost to lend and therefore the cost to the borrower would be much lower.


5. Credit Union CEO: We're starting to rethink the centralized call center approach.

One reason often cited by customers for using branches is to solve problems. But phone calls to banks/ credit unions typically go to a centralized call center while branch lobbies are empty, denying the branch person of a sales opportunity.


6. Bank Exec: Any FI has access to their customer data. The real successful ones know how to analyze it and act on it.

Just be able to identify single service customers, have alerts for customer events such as large deposits (other than for compliance reasons), run queries for all customers by product type by Zip code... you know, common sense stuff that helps go-getters go and get.


7. Bank Exec to me: We talk to a lot of other bankers and nobody seems happy with their core processor.

How much of the market does Fiserv, FIS, and Jack Henry own?


8. Bank director to me: Advertising sells the first car, service sells the rest.

Guess what industry this director hails from?


9. Bank CFO: The FDIC is on a rising rate binge.

Examiners tend to have a theme when they come for their regular exam. This time around, the theme appears to be interest rate risk.


10. Bank CEO: We can't control who comes in our branches.

Then may I suggest downsizing branches, eliminating Marketing expense, and removing business development activities from job descriptions?


11. Me to bank retail head: Why bank with you? What is your value proposition? Banker: Stability.

That's the first time I heard this as a differentiator. But I believe it can be, especially if the bank across the street changed signs several times over the last decade, or there has been a high profile local bank failure.


12. Bank CEO on his future strategy: A few locations and tons of digital.

If your bank has few locations, embarking on an aggressive branching strategy doesn't seem to make sense, given rapidly changing customer delivery channel preferences.


13. Bank Director: We have to be careful cutting staff in branches, because with the lack of customers the branch might look too empty.

I can't make this stuff up.


14. Bank CEO: Jeff, I'm hoping for a boring banking environment before I retire.

To which my daughter, @shannonmarsico tweeted back to me: I thought boring banking environment was a given.


What are bankers telling you?


~ Jeff

Banker Quotes: As Told To Me v6

I learn a lot from bankers and industry experts 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 since version 5.

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 people anonymously to protect the innocent.

1. Me to bank CEO: How many customers left as a result of you consolidating a branch? CEO: 3.

If this bank's experience becomes typical, I see little reason to keep branches that have not proven to generate at least $25 million in deposits.

2. Bank CEO: Bloomberg says the duration of a 30 yr mortgage is 8-10 yrs. We think it's 29.5 years.

Not many borrowers will be running to refi their 3.5% mortgage any time soon.

3. Bank examiner: We're focusing on the interest rate risk from bankers reaching for yield.

Duly noted.

4. Bank Exec: The mortgage business only has a 30-day business plan.

Ever speak to the head of a mortgage origination shop? You wold be lucky to get them to think beyond the current pipeline.

5. Bank SVP: the mortgage lending business is like a shark. You have to keep swimming to breath.

And by the way, if Dodd-Frank tried to weed out bad actors in this market and put bankers back in the business, think again. D-F erected barriers to entry that makes it very difficult for your branch manager to talk to you about a mortgage.

6. Bank CEO: "You gotta have a dream. You may not realize it, but you gotta have one." Amen!

This is an emphatic statement about vision. Do you have a vision about where your FI is going that is clear, and resonates throughout the organization? This banker does.


7. Bank CEO: I get a lot of my financial industry updates from LinkedIn. 


Maybe social media is happening outside of the Marketing Department.

8. Bank branch construction firm CEO: The most common branch build remains 3,000-3,500 sq ft. Me: *sigh*

Old habits die hard. At least we won't have all the environmental problems that old closed down gas stations have when our branch is long empty and weeds are coming up through the parking lot cracks.

9. Bank CEO: Our current strategy is to satisfy the OCC.

What is the vision for your FI? Compliance? There's a sure thing for an enduring future. It should be noted that this bank was under a regulatory order.

10. CU Exec: We spend 30% of our time doing the right thing & 70% of our time documenting that we did the right thing.

How do you calculate that cost, Mr. Regulator?

11. Bank President: The government is intent on making banking a not for profit business. 

I thought the government was here to help?

12. Bank CEO: I'm currently a development loan workout specialist.

Two things to note here: 1) Development loans were the worst for most FI's during this recession, and 2) Lenders were generally terrible at working out their own credits.

13. Bank CEO: We do things better AND get better pricing.

I must admit I hit bankers hard on this issue in strategy sessions. I'm convinced Best Price & Best Service is not a sustainable business strategy.

14. Bank Analyst: The CEO is past the age where he should be home watching The Price Is Right.

This is a legitimate industry challenge. CEO's that hang on well past retirement age may think that there is nobody to do it as well as they did. Which is unfortunate. Because we need future leaders to do it differently.

15. NJ Banker and West Pointer Norm Beatty quotes Stonewall Jackson: "Never take counsel of your fear."

Amen Norm. Bring on the change!

What are you hearing out there?

~ Jeff

Note: To get banker/industry quotes as I hear them, follow me on Twitter @JeffMarsico

Banker Quotes: As Told To Me v5

I learn a lot from bankers and industry experts 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 since version 4.

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 people anonymously to protect the innocent.

1. Bank CFO to me: Whistling by the graveyard is the best of bad choices when looking at our parked deposits.

In the third quarter 2008, the average money market account had a balance of $72,823. Scroll forward to 3Q 2012, the average balance ballooned to $112,060. Do you think your duration assumptions should change?

2. Bank consultant: If the house is on fire, don't expect credit for finishing the basement.

Regulators will focus on the fire. Your carpeting job in the basement doesn't matter.

3. Car salesman to me: 98-99% of my 2012 sales were financed.

And auto loans performed well during the most recent recession. I suppose the saying is true: You can sleep in your car but you can't drive your house.

4. Bank CEO to me: A great relationship might get you 25bps on a loan. Covenants can get you another 25-50.

Skeptical. I would like to see this in action. So those with great relationships don't discount the price to "get the deal done?"

5. Bank institutional investor to me: "For banks to be relevant they should have 35% of revenue in fee income." Me: Profitable fee income?

Your level of fee income only matters if something drops to the bottom line. For many, the only thing left for the bank is the risk.

6. Bank CEO: We're feeling some [economic] recovery but why does it have to be so painfully slow?

It took US Bank two years to evict Kiss' Ace Frehley from his house after he stopped making payments and paying taxes. 

7. NJ Bank Exec: We have a handful of shore loans where we not only can't find the building, we can't find the land. #sandy

Real world problems.

8. Bank CEO: We need to fix our processes because I can't get the egg through the snake fast enough.

At a time of low loan demand, perhaps a process review is in order.

9. Bank consultant: If a regulator doesn't like your bank, there's always something they can find in Compliance. #tyranny

Unfortunately, true.

10. Retail Banking Exec: Until today retail deposit products were driven by the land of the free.

An industry self-inflicted wound. Agree?

11. Bank director: re-imagining the branch network will include complexity and drudgery. But it will be worth it.

I was surprised to hear this from a director. Usually, by change, bank director's mean switching to the tuna salad instead of the chicken salad.

12. Bank Chairman: In my business, getting something done quickly meant by Friday. In banking, it's in two or three years.

One reason: There are roadblocks to asking permission and penalties for begging forgiveness. But let's not forget the Sergeant's that run our bank that embrace change like my daughters embrace my opinion.

13. Bank CEO: We're doing so well because our competition is so bad. #classic

And many of you reading this are this bank's competition.

14. Bank Chief Risk Officer: Our biggest risk is regulatory grind. It is constantly wearing down our staff.

Let's not allow the final arbiter of our strategy to be the "no" person in compliance.

What are you hearing out there?

~ Jeff

Note: To get banker/industry quotes as I hear them, follow me on Twitter @JeffMarsico