Behind the Vault

The cliché that a failure to plan is a plan to fail often rings true of local initiatives of community FIs. Ryan Harvey, CEO of Family Trust FCU of Rock Hill, SC, shares their approach to community impact and the deliberate efforts they've made that led to 1 in 5 residents joining their credit union, even in the shadow of banking metropolis Charlotte.

Highlights from the episode:

- Family Trust's philosophy for local impact and their focus on grantmaking to local grassroots organizations to build up capacity in their own community

- The institution's use of mentoring and networking to improve the impact of monetary investments

- The ways this philosophy leads to some traditional and non-traditional programs, including how the CU partnered to bring a free, all-electric bus system to Rock Hill

- The alignment within the CU to fostering and supporting a culture of volunteerism

To learn more about Family Trust's local efforts, visit their 501(c)3 foundation website https://thecommunitypartnershipfoundation.org/

Sometimes, the name says it all. This week, we speak with Lex Ford, President and Director of Climate First Bank. A Central Florida de novo bank started in 2021, Climate First aims to use banking to reduce atmospheric CO2. But the bank isn't just for those looking to work with like-minded businesses. Lex shares the organization's philosophy and approach to internal alignment and bringing as much of their community along with them.

Highlights from our discussion:

* Climate First's origins and unique structuring as a B Corp

* The bank's approach to branch development and use of LEED certification

* Creating bespoke solutions like loan origination software to speed the financing of solar projects

* Why they cater to traditional fossil fuel customers

* Using their own annual reports as impact statements and an example of accountability and transparency

To learn more, visit https://climatefirstbank.com

The bank's annual impact statement: https://www.climatefirstbank.com/our-impact

Few things have impacted community financial institutions like the regulatory landscape that emerged from the Great Recession. Our guest, Miriam Mitchell, Chief Lending Officer at Addition Financial, shares her insights on adapting to the Dodd-Frank Act and the approaches they are taking with today's housing market.

Highlights from our discussion:

* The two-edged regulatory sword of Dodd-Frank, and how it both helped and hurt individuals served by community FIs.

* Navigating the compliance requirements and the outsized burden on smaller institutions.

* The role of local lenders have played in the turbulent real estate market and the unique local issues in Florida.

* The emerging issue of rapidly rising lending and insurance costs and how Additional Financial is responding.

Addition Financial: https://additionfi.com

Miriam Mitchell: https://www.linkedin.com/in/miriam-mitchell-mba-480b2ba/

How does the age distribution in your community directly impact your institution's risk? In this episode, we talk with Gazi Kabas, co-author of the oft-cited paper Population Aging and Bank Risk Taking, which examines the effects on community banks and credit unions when the average age in their served markets quickly grows older.

Highlights from our discussion:

- Why this team of European economists are studying American financial institutions, and how their findings are not just relevant in the U.S.

- How demographic changes are impacting the risk profile and lending practices across the country.

- A look at the indicators of detailed analysis of loan-to-income ratios provides insights into banks' lending behaviors, highlighting a propensity for increased risk-taking as populations age.

- The outsized risks for smaller community FIs.

- Some potential ways regulators and individual institutions can mitigate the individual and systemic risks to banking.

The full text of the paper can be found here: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3430184

For more on Dr. Kabas's research and to contact him, visit: https://gkabas.netlify.app/

In this episode ww dig into how close ownership opens up a different way of doing business. Glenwood State Bank president Peter Nelson shares the profound impact a purpose-driven approach can have on banking strategy and community engagement.

Highlights from our discussion:

- The history of the bank and the shift in measuring results from short-term financial returns to stewardship and long-term community impact.

- How the multifaceted nature of their community has shaped their diverse portfolio, including personal banking, commercial business, agriculture, insurance, and real estate.

- The challenges of maintaining the commitment to purpose through economic downturns.

- The advantage of the bank's values and purposes for attracting and retaining employees aligned with the bank's mission.

- The challenges of managing family business dynamics, including working with relatives and succession planning for future generations.

For more information or to connect with Peter Nelson and learn about their unique approach visit https://glenwoodstate.bank/.

In this episode, we look at lessons learned from radically embracing a digital-first experience. Amy McGraw, VP of Marketing and Chief Experience Officer at Tropical Financial Credit Union, shares insights from their journey and the hard choices success demands.

Highlights from our discussion:

- Putting personalization first and the ability to break out of traditional marketing cadences.

- The importance of technical partners inside and outside the organization and the role Fintech and CUSOs play.

- Making the decisive and hard choice between physical and digital presence.

- The critical role core banking providers play.

- The tactics for providing a personal experience and keeping a "people helping people" mindset in a digital-first organization.

- The overlooked key capabilities in organizational change management essential to success.

For more information about Tropical Financial Credit Union and its innovative approaches to customer experience, visit https://www.tropicalfcu.com/.

In this episode, we delve into the journey of BHCU with CEO Gary Golden. With a history going back to 1952, BHCU is taking on a new growth and expansion approach. We look at the strategies and tactics Gary and his team employ to deliver new paths for sustainable growth for an older credit union.

Highlights from our discussion:

-The strategic pivot to a community charter from a select employer group (SEG) charter and the geographic expansion into adjacent counties.

-The critical role small businesses play for new business lines and a source of new members.

-The grassroots approach to growth and BHCU shift in marketing spend from traditional advertising to one-on-one connections and personal relationships.

-The selective use of technology in enhancing customer experience and balancing that with their differentiating in-person approach.

-The role M&A plays in their plans and the unique challenges for credit unions to succeed with this approach

To learn more about Gary and BHCU, visit https://bhcu.org.

In this episode, we talk with Mark Arnold, President and Founder of On the Mark Strategies, to discuss the importance of customer experience in community financial institutions. We also discuss the often missed tactics for improving the experience as a powerful competitive advantage.

Topics discussed:

-Why customer experience is a competitive advantage, and how institutions could be missing out on up to 40% of potential business due to subpar customer experiences.

-Identifying gaps in service, the Johari Window, and where to look for the most common areas community banks and credit unions underdeliver for their customers and members.

-The common blind spots that trip up FIs and how they affect the organization's performance and growth.

-Working customer experience assessments into planning and keeping up with changing consumer expectations.

"We've learned to glance at our competitors and glare at ourselves."

To learn more about Mark Arnold and his work, visit https://markarnold.com.

In this episode, we hear the story of the Bank of Ann Arbor's acquisition of UniFi Equipment Finance and its successful entry into an entirely new business line. CEO R.J. Grimshaw joined UniFi shortly after their purchase and led the integration and rapid growth of the business as a product line of a regulated bank.

Highlights from our discussion:

-Transforming a 35-year-old company into a new culture, implementing new business systems, and introducing the compliance and regulatory structures of a regulated bank.

-Avoiding the biggest mistakes banks make buying a commercial loan or leasing organization

-Navigating the transition from a ZIRP environment into the rapidly rising rates, inflation, and asset cost growth, and finding new sources of business when OEM is kneecapped by supply chain issues.

"When it comes to the commercial asset financing business, don't dabble!"

To learn more and contact R.J. visit https://rjgrimshaw.com.

Think you'd be a great guest on the show? Apply HERE.

In this episode, we sit down with Gregg Margosian, Chief Operating Officer of Toshiba Global Commerce Solutions, a company deeply embedded in the world of retail store systems. Gregg provides insight into emerging trends of consumer behavior and how that is impacting payment systems in the US.

Topics discussed:

-Why self-checkout is becoming the norm in retail, with a preference of 85% for shoppers

-How the pandemic reshaped mobile payments and what this means for the future of contactless payments like ApplePay

-The persistence of cash in an increasingly digital world, and the cultural factors driving it

-Potential breakthroughs in mobile payments and whether a major player could revolutionize the industry

-The challenges and opportunities for retailers in the changing payment landscape

Want to learn more about Gregg's work at TGCS? Check out their website HERE.

Think you'd be a great guest on the show? Apply HERE.