The Community Bank Advantage

Jim Marous (00:11):

Welcome to another episode of Banking Transformed, the podcast that dives deep into the trends, innovations, and strategy shaping the future of banking. I'm your host, Jim Marous, owner and CEO of the Digital Banking Report, and co-publisher of The Financial Brand.

Jim Marous (00:27):

Competing as a $1 billion financial institution puts pressure on operational efficiencies and technology investment. However, modest size doves present opportunities. Organizations of this size a little bit bigger, a little bit smaller, are typically large enough to invest in the necessary technologies while remaining agile enough to adapt quickly to local market needs and maintain close community ties.

Jim Marous (00:54):

Today in the Banking Transformed Podcast, I have Brian McEvoy, the Chief Retail Banking Officer at Webster Five Savings Bank. With extensive experience at national banks and community organizations, Brian brings unique insights in building successful community banking organizations in today's digital age.

Jim Marous (01:14):

Our discussion explores how smaller banks can compete effectively while maintaining their community focused mission.

Jim Marous (01:22):

Running a billion-dollar community bank in today's competitive landscape involves many unique strategies and challenges. Today's conversation will provide valuable lessons for banking executives in bigger organizations, smaller organizations, and billion-dollar organizations around how to build banking better in a community banking environment.

Jim Marous (01:44):

So, Brian, before we start, could you walk us through a bit of your career journey. Because you really started at really large national and multi-regional banks, and now you're at Webster Five. What motivated the transition and how did that all take place?

Brian McEvoy (02:00):

Yeah, thanks, Jim. Good morning. It was an interesting journey for sure. I started my banking career in high school. I think I was somebody that was heavily interested in the humanities, political science, et cetera, and I had a guidance counselor that said, "Why don't you take a class in the vo-tech center?" And I heard banking was easy.

Brian McEvoy (02:20):

So, I started working at the Fleet Bank branch, took a class there and ended up as a float summer banker, and that ended up turning into a career overtime. After I came back, summers in college, working shifts over the summer and things of that nature, it actually became something I love.

Brian McEvoy (02:44):

But I'm a retail banker through and through. I started in branches. I've always been around branches. Even if I haven't worked in the branches, I've supported them at a variety capacity. So, my career really started at Fleet.

Brian McEvoy (03:01):

I spent some time; my first branch manager job was at Citizens Bank. And then I went to work for a company called Banknorth, which was a regional community bank, probably about 20 billion at the time, headquartered in Maine. And they opened their, one of their offices in Massachusetts. And career was going well, became a regional manager.

Brian McEvoy (03:25):

And at that point in time, TD had come in and acquired the bank. And TD had a very good talent development program. So, they looked at me for whatever reason, probably wrongly as high potential, high performing, and invited me to look at some career opportunities outside of the branch network.

Brian McEvoy (03:46):

And ultimately, I had the opportunity to work in Maine on the retail sales strategy team under a gentleman named Machi who pretty much taught me everything I know. And at that point in time, I started my, I'll call it corporate career outside of the field really running elements of the sales strategy for the branch footprint main to Florida, about 12, 13,000 employees, 1200 banking centers, et cetera.

Brian McEvoy (04:23):

And then my career kept moving along from there. From the sales strategy side to really store operations and transformation. I had the opportunity to run a workforce management team, due in new branch, format pilots, look at process optimization, and really with a focus on efficiency and driving bottom line results for the store network.

Brian McEvoy (04:54):

And so, that brought me to Cherry Hill, New Jersey where I met some other great folks. At TD. About 2015, I got a call about an opportunity at Synovus Bank, which I had known, followed for a bit. And they were looking for somebody that had a background in sales strategy, operation strategy, really to help run the new retail strategy format.

Brian McEvoy (05:23):

I had the opportunity to take on that role, which was really just a block on a piece of paper with a description on it. And so, it was really complete white space for me employee number one of the retail strategy division. And really built out a market planning team and data and analytics for branch strategy, all that kind of stuff.

Brian McEvoy (05:52):

So, really great role. Met some awesome people there as well. Learned a ton from that organization. And looking back in 2020 I'd spent, however many years at that point in the branch network, in sales strategy and operation strategy, basically doing everything in the branch or supporting the branch.

Brian McEvoy (06:16):

And I had a chance to take on this role at Webster Five, which I got a call from a corporate recruiter that I'd worked with a bunch over the years, helping place talent and community banks, really in New England, main based company. And they were calling, looking basically for a referral for this job, which was the chief retail banking officer role at then probably an $850 million community bank. And I raised my hand, I said, "What about me?"

Brian McEvoy (06:52):

And the recruiter kind of laughed and said, "You're a big bank guy, what are you talking about? That's totally out, it doesn't fit." And for me, the opportunity was to basically piece together everything I'd experienced in different roles. Smaller fish in a bigger pond, and basically take all those learnings and put them together and be responsible for the retail banking function at a community bank.

Brian McEvoy (07:22):

And it helped that it was back home, born and raised in the Boston area, even though I don't have the accent all my family's here. And so, it was really a win-win from a professional and a personal standpoint.

Jim Marous (07:37):

Obviously, a lot of experience over the years, and you mentioned about the branches, and I started in the branches at a large bank right out of university. And you never forget that experience.

Jim Marous (07:47):

You never forget what was important to a branch person, the people you met, what you did. And it really forms your relationship with banking on a retail basis in a very unique way. Nobody I've ever talked to that started in branches doesn't remember almost everything that they learned back then, because it all still applies. It really does.

Jim Marous (08:10):

And so, when you went from the large institutions and now at Webster Five, what key lessons or experiences from the large organizations have proven to be the most valuable at this smaller organization?

Brian McEvoy (08:25):

I think there's a couple, Jim. One of them is that conditions are temporary. And what I mean by that is you really do have to play the long game. I remember a time, going through the great recession where the goal was managed through the trough. Like we can get through this, there is something on the other side, but you have to be able to survive before you can thrive.

Brian McEvoy (08:53):

So, sometimes it's really about getting back down to basics, brass tacks, bootstrapping, whatever you want to call it, and focusing on the fundamentals. And I think the biggest challenge is you always want to have your eye on the future and on transformation and on innovation. But sometimes you have to do the basic blocking and tackling, or else you won't have the opportunity to do that.

Brian McEvoy (09:16):

So, that's probably the one of the biggest learnings. I think the second one is that strategy really does matter. You have Drucker out there that says, culture eats strategy for breakfast. I believe that too, culture is really important.

Brian McEvoy (09:30):

But you do have to have a strategy really a guiding north star for where you're taking your business. Otherwise, it's too easy to get distracted. There's shiny objects all over the place and you could be left blowing in the wind if you don't really stay focused on what your core strategy is. So, those are a couple learnings I've been able to bring really to the community bank setting over the past few years.

Jim Marous (09:58):

So, it's interesting, you came from, as you said, TD banks, Citizen banks, Synovus, really focusing on the branch function. What's happened over the years, as you well know, is we've moved away from passing out great pens at the window at TD bank and dog biscuits to having to do things digitally.

Jim Marous (10:20):

And one of the questions I used to ask people from TD, I guess 10 years ago, was, how do you take that level of person-to-person engagement, how do you make that work in a digital way? And I'm sure that's what you're up against at Webster Five.

Jim Marous (10:40):

So, how do you leverage your branch-based experiences and move them into the digital world where more than half of the transactions now are done on the digital platform?

Brian McEvoy (10:51):

Yeah, great question. I wish we had a chance to talk 10 years ago when I was at TD because, I rolled out a program called Wow Goes Digital. And you're familiar with the TD culture.

Jim Marous (11:03):

Exactly, yeah.

Brian McEvoy (11:05):

It's all about the wow. And I think you captured it perfectly, which is that really translated into physical lollipops, dog biscuits. The in-branch experience and the question there, really the challenge was how do you take that into the digital arena?

Brian McEvoy (11:25):

And part of that is really your employees, your team members have to embrace that digital is part of the experience that you are delivering.

Brian McEvoy (11:38):

So, they need to understand it they need to be advocates for it. They're really, I don't want to say selling it, but they're knowledgeable about it and providing really the information for the customer about how to access digital, how to utilize it in a way that makes their lives easier.

Brian McEvoy (12:00):

And I think even most importantly is if a customer is going through a self-service journey, and they're in the digital arena and they get stuck, you have to be able to drop everything and know how to support them and help them through that challenge. So, how do you do that?

Jim Marous (12:20):

Yeah, exactly.

Brian McEvoy (12:22):

I think one piece is education. We had the opportunity back then to pilot something that's now called the Lemonade Experience Learning Platform. I can't remember what it was called back then. But really to use micro learning and gamification to I guess incent and inform employees on what those digital experiences are. Because I think bankers and certainly branch bankers are probably the most guilty of going to the easiest solution as customers.

Brian McEvoy (13:02):

I work in a branch, I'm going to use the branch services, and maybe I'm not as knowledgeable about how mobile banking works. I don't know how to make a deposit, or use cell or whatever. That's a challenge, our employees need to be really experts in that arena, because to your point, that's where customers for the most part are going first.

Brian McEvoy (13:23):

So, providing them really fun, engaging learning experience that's interactive, and it gets them familiar with the digital properties, so they don't view them as scary or basically competing with the services they deliver in branch, but really look at them as more of an overall part of the experience for the customer.

Brian McEvoy (13:47):

I think another piece of that also is having effective customer relationship management. We didn't have a CRM tool at Webster Five until recently. So, it was difficult to see really call it a single pane of glass or 360 view of the customer, whatever you want to call it. But what is the customer doing when they're contacting the call center, or they have a message through a secure message in digital banking or they talk to a commercial banker.

Brian McEvoy (14:21):

Being able to see that activity and understand how the customer is utilizing the bank really informs how you engage with that customer and provide them with additional solutions.

Jim Marous (14:34):

So, you really — and it's interesting because I'm hearing a lot of the Synovus mentality too, that you really make it so that the digital channel is not a threat to the retail channel as it is the branch and the back office of the retail base. Which again, it gets down to, and talking to Liz Wolverton at Synovus, she says it too, it gets down to communication.

Jim Marous (14:55):

How do you make it so when you close a branch the people are actually working for you in that case, and not against you. And its communication, it's engagement, it's having them understand that these work together and they work synergistically with each other.

Jim Marous (15:11):

So, when you're talking about the movement to Webster Five, obviously it was a completely different environment. You were hired to do what you had accomplished at other organizations, but in a different way. What was the biggest challenge you had in adjusting or taking what Webster Five then had and make it what it has today?

Brian McEvoy (15:32):

I would say the biggest challenge for me, Jim, was really the way that a community bank, especially a mutual community bank operates, is fundamentally different than a regional or a national bank, certainly a stock- based regional or national bank. So, how the bank is funded is different. The operating structure is different. Even to an extent the competitor set and how the financial institution is viewed as different.

Brian McEvoy (16:09):

So, working at a community financial institution like Webster Five we're mutually held. And what that means is we're owned by our depositors, we don't have shareholders. And so, the strength and the advantage of that is we can make long-term planning decisions. They still have to make sense from a profitability perspective. But we're not looking at making the next quarter number and making decisions in the short-term that we then have to figure out later.

Brian McEvoy (16:45):

So, I mean, actually being able to implement and operate that way was a little bit of a change for me in terms of believing that that is actually how we do things and making decisions based on that rationale, but it's a positive thing.

Brian McEvoy (17:07):

I think in terms of the competitive set though because we're a community financial institution and we are mission based, oftentimes we get equated in a lot of ways with credit unions. And so, some of our customers that have been with us for a long time will bank with us, and they'll also have credit union relationships versus banking with us and having relationships with Santander or Bank of America.

Brian McEvoy (17:36):

So, on the consumer side, it is a little bit of a different customer base as well. And so, that was an adjustment for me, but one that was pretty seamless.

Jim Marous (17:47):

So, you discussed the challenges and obviously to a degree, the funding and the investment level is going to be different. What was the surprise advantage you found moving to Webster Five?

Brian McEvoy (18:01):

Yeah, I mean, the surprise advantage is the customers really love the bank, and not that they didn't at other financial institutions, but the scale of, for example, net promoter score is different. We used to be excited about one set of numbers, now if we're at Webster Five below that set of numbers plus 30, it's a concern.

Brian McEvoy (18:30):

And so, the level of commitment to that relationship between the customers and the bank is surprising in a positive way. The average tenure of a customer and an account relationship is much, much longer than I'm used to as well. So, it really, the loyalty of the customer base to the financial institution is a huge, huge advantage because it does provide stability of that core funding base as well.

Jim Marous (19:01):

It's interesting because I went from National City Bank to a company called Women's Federal Savings Bank. So, I had very much the same transition where there are a lot of the advantages, and you said the loyalty was different. It was more heartfelt. The people would stand up in a competition, in a discussion and say, no, but my bank does this, or my organization does this. And they view you as a bank, but in a different way. So, you get a little bit of the best of both worlds.

Jim Marous (19:29):

One thing that's challenging, however, is that in today's environment, that loyalty is being tested, not because they're leaving Webster Five, but if it's anything like most every other institution I'm talking to and meeting with, they get eaten at the edges.

Jim Marous (19:48):

A person has an account at Webster Five, but they also have an account with SoFi or Robinhood or Acorns or Ally or any of these other organizations, and you find that the distribution of the relationship changes.

Jim Marous (20:03):

How are you approaching digital transformation at Webster Five, while retaining what makes Webster Five special? What are things you're working on today to make Webster Five better?

Brian McEvoy (20:18):

Yeah, great question. One of the things that honestly is looking at that competitive landscape and recognizing that in some cases there's really no turning it around. People are going to use other services that are convenient for them. Payments Space is a great example, Venmo, PayPal, whatever, the ship is sailed in a lot of ways.

Brian McEvoy (20:43):

We offer person-to-person payments embedded in our digital banking experience, because we do have customers that want to use that. But at the same point in time, we're not going to win a bunch of market share that way.

Brian McEvoy (20:57):

And so, it's recognizing that there's some battles that you can fight and win, and others that are probably bigger than you.

Brian McEvoy (21:08):

But in terms of competing and becoming digital and also still remaining personal, one of the ways we've looked at that is through effective partnerships. I don't want to call it open banking, but with our technology platform that we have today, we do have pretty open API integration with digital. And so, we have the ability to partner with some really unique and innovative firms that provide a service that we don't really have the scale a stand up on our own. And so, it's a nice value added.

Brian McEvoy (21:44):

So, looking at that FinTech relationship as a partnership opportunity instead of a competitor opportunity is where we found some success.

Brian McEvoy (21:54):

One recent example of that is we're one of the, I'm not sure how many, but certainly one of the, probably first 15 or 20 banks in the country to roll out Spiral which is a giving platform that enables customers through their digital banking. Number one, to do roundups on their debit card and select the not-for-profit of their choice instead of going to the terminal at Target or whatever, and hitting roundup for the nonprofit of the day that Target's supporting.

Brian McEvoy (22:28):

And also, through the digital interface there's a giving center where they can make one time or recurring donations to the not-for-profits that they care most about, the charities they care most about. And everything is handled behind the scenes. All the tax classification and everything is managed for them.

Brian McEvoy (22:53):

So, providing that value added service, which we think is important in the marketplace too, as the landscape changes on who is now signing up for banking accounts and looking for new banks and new financial institutions. Cause-based purchasing across industries really feel strongly is the wave of the future and that applies to banks too.

Brian McEvoy (23:19):

So, a customer that's my son's age or whatever, is looking to partner with brands really across the spectrum that have core values that are aligned with his. And so, providing that true kind of link to giving in a way that's personalized and reinforcing our commitment to community values is really important to us.

Jim Marous (23:47):

So, everybody's needing to grow or at least run in place very fast. How does Webster Five attract new customers and build relationships with existing customers? What strategies do you have in place for that?

Brian McEvoy (24:03):

Well, I mean, first of all, in terms of growth I joined the bank in June 2020, and we've grown our asset base by 50%. So, we're having a lot of success there.

Jim Marous (24:13):

You're doing well.

Brian McEvoy (24:15):

Yeah, we're doing okay. It's been great ride, and what I'll say, Jim, is, the majority of that asset growth has really been on the commercial banking side. So, for us, one, it's about differentiation.

Brian McEvoy (24:31):

So, I mentioned, we're a mutual community bank, believe last count there were 82 mutually chartered community banks in Massachusetts, there's probably 400 in the country. So, we're a hotbed of mutual community banking.

Brian McEvoy (24:46):

I think in our marketplace in Worcester County in central Massachusetts there's probably eight community financial institutions between half a billion and call it $2 billion in that class. And probably half of them have green branding. And there's, maybe you could look at it if you weren't paying close attention that maybe there's eight different flavors of vanilla.

Brian McEvoy (25:14):

It's really important for us to stand out in that environment. And so, we've been able to make a name for ourselves as really the commercial community bank. And it really comes down to where you have expertise and leveraging that and really focusing on your core competencies.

Brian McEvoy (25:33):

So, for us we have really outstanding treasury management services that will think compete with regional and national banks at that level. That is really something that our pure banks and pure asset class really can't provide to the same degree.

Brian McEvoy (25:50):

We also have specialization in not-for-profit lending. We've had some big wins in that arena. And then in the branch network, retail's the side of the house that I manage, we've really embraced that business identity, and we've changed our delivery model to focus on being out in the community more, having branch managers that are market managers that are doing more business development and really trying to scale up our growth in the small business banking arena. That's where we see really outsized growth opportunity for us.

Brian McEvoy (26:29):

The consumer matters. The consumer is something that we'll never take our eye off the ball on. And we're doing different things to try to attract new consumers as well. Spiral being an example. But our strategy has really been also to focus on the branch network as a delivery channel for small business services and really embrace that commercial identity.

Jim Marous (26:57):

So, how are you building what I'll call a digitally mature organization, both on the retail and the business side? What are you focused on yourself in making digital banking better? Because the branches, I'm not going to say they stay on their own, but the investment in them isn't needed as much as on the digital side right now. And that's obviously something that's changed during your career.

Jim Marous (27:21):

But what are you doing to try to make the digital experience better for Webster Five customers, both retail and the commercial?

Brian McEvoy (27:29):

I mean, the first thing is you have to have the right digital platform. And so, recently on the ABA Banking Podcast, our CIO Kate Megraw was on talking about our core transformation that we went through over the past year. So, we changed our core that we had for 25 years and our digital banking platform.

Jim Marous (27:54):

How long did it take?

Brian McEvoy (27:56):

So, from the time we signed the contract to our implementation date was, I believe, 11 months.

Jim Marous (28:03):

Oh, my gosh.

Brian McEvoy (28:04):

10 Months, 11 months, somewhere in that ballpark.

Jim Marous (28:07):

I'm sorry. You've been in commercial banking long enough that that is amazing because I know banks that have taken 10 years. Um it's crazy. And it sounds like you did it in whole, it wasn't a composable solution where you did certain solutions and that's all, you did it all.

Brian McEvoy (28:28):

It was a rip of the band aid approach, Jim. I wouldn't recommend it to anyone, although there's really not a better way to do it. Like we get it done, and we have the scars to prove it.

Brian McEvoy (28:42):

But in all honesty, there are some bumps, but it wasn't bad at all, because a big part of it that helps is our customer base is loyal and understanding, and we had a really, I think, effective communication plan with multiple touch points; email, direct mail drops, messaging, a micro site on the website, everything to try to prepare for that.

Brian McEvoy (29:09):

And then it was all hands-on deck on conversion weekend and where we did experience some issues, the first week after conversion was from the CEO on down, we're answering the phone and trying to problem solve, probably analogy that I would use is, before I started my banking career, I worked in grocery stores.

Brian McEvoy (29:34):

And in New England, you get snowstorms, you get that rush, and when you see the store manager bagging groceries or pushing carts in, it's been a day. That's what a core banking conversion is like right?

Jim Marous (29:48):

Oh, yeah.

Brian McEvoy (29:49):

And so, but we got it done and we're the better for it. And to your point, we didn't take it in stages. We did change our payment rails. We implemented a new digital banking solution for personal and business. And we did all of the underlying core stuff in one weekend.

Brian McEvoy (30:10):

And so, the biggest win out of that is we got really I think, the best in class digital banking platform that is easy to plug other experiences into. We've done account switching, subscription ship switching, Spirals I mentioned before auto books on the business banking side. And all of those solutions are pretty easy to stand up.

Brian McEvoy (30:44):

We're looking at one right now that I won't name because we're not under contract, but where we're talking to them, they already have a full integration with our digital banking platform. They said from time to sign the contract to implementation, go live, they're seeing 40 days with most of their clients with this platform.

Jim Marous (31:08):

That's what's amazing about these partners that you can build right now. If you have the right mentality within your organization, which obviously you do.

Jim Marous (31:18):

Believe me you've seen it because you've worked at an organization that have the leadership, but it starts at the top, and if you don't have the leaders that are willing to embrace change, things are going to be different, things are not going to maybe focus on what they've learned in the past and done very well, but have to move forward.

Jim Marous (31:37):

If you have that, it makes it all that much more easy. And in addition, as you've obviously found out, once you sign one of those contracts, and once you decided to change the way you do things, you also have to get out of the way. You cannot put barriers or hurdles in the way that are going to change things.

Jim Marous (31:57):

I referenced the fact that new account opening experiences of a three to five minutes. If the organization that signs the contract when they come in, the first thing they say is, "Oh, by the way, we still need to use driver's licenses.” You basically have blown up the entire process on your first meeting. And yes, you'll get better, but it's not efficient. It's not as good as it could have been. So, let's take a short break and recognize our partners.

[Music Playing]

Jim Marous (32:27):

Welcome back to Bank Transformed. Today I'm joined by Brian McEvoy, the Chief Retail Banking Officer at Webster Five Savings Bank.

Jim Marous (32:35):

We've been discussing the opportunities and challenges of running a billion-dollar financial institution. Right before the break, Brian, we were talking about your core conversion. And it's interesting because if you're doing a core conversion, there aren't many institutions that have truly done it in the complete way that you did it.

Jim Marous (32:54):

You can't stop banking and building while that's going on. You're in charge of the retail banking sector, you got to continually make innovations happen and deploy things, even though your back office is like liquid mercury. It's like scaling all over the place. What was the biggest challenge in that conversion from the standpoint of business as usual?

Brian McEvoy (33:20):

Wow. Good question, Jim, I didn't really want to think about that again, but here we go. No, you're absolutely right because it was a little bit less than a year that we were really in conversion state. All of 2023 was essentially all about the conversion. And you're right, you can't take your eye off the ball. You've got to continue to grow. You have to keep doing business as usual.

Brian McEvoy (33:46):

And so, a big part of it for us was making sure that while all of the data mapping and testing and all of the core prep work was happening, we're also number one, delivering training to our frontline employees. Because if you get all the data right, your conversion day goes off without a hitch, but your employees don't know what they're doing, that's a big problem after the fact.

Jim Marous (34:15):

It's going to show very quickly. Yes.

Brian McEvoy (34:17):

It absolutely will. And we have people that have worked at the bank. We have somebody actually, I believe that's at 47 years. But in the branches, some that are north of 30 as well, they've always done things a certain way because we have the same core for 25 years.

Brian McEvoy (34:38):

And so, getting them to be able to make the transition and learn how to use the new operating platforms to serve customers really in a different way was a huge area of focus for us, but business can't stop either. And so, from a retail banking perspective, and especially in 2023, as you know Jim, from all your research deposits were no joke. I mean, the deposit game was, interesting is the word I would use.

Brian McEvoy (35:15):

And so, we focused heavily, we really doubled down on what are the goals for the branch network, what are the targets are we trying to accomplish in that arena? Both in terms of new account relationship management, growing deposits, cross-selling into customer relationships.

Brian McEvoy (35:37):

Really trying to scale up our small business lending effort, which is something that while we're building out the new core, we also are standing up a digital small business lending application, which is self-serve, but in a lot of cases the customers require some assistance. And we've really utilized our market managers and the branches as the champions of that solution.

Brian McEvoy (36:05):

So, there was plenty to keep them busy, and we certainly were focused on continuing to grow the balance. I don't know that we did anything unique in that time period because there was such a focus on the core, but we did want to make sure it wasn't an excuse to basically put the brakes on and not do any business. We had to manage it both and juggle.

Jim Marous (36:30):

Well, and also, from your perspective, as you're implementing the core, you are really looking at what next. I mean, you have to, because you can't start from square one, as you said, with your employees if they're not trained, if they're not ready to go on day one, the whole thing falls apart.

Jim Marous (36:46):

Well, in the same sense, I would imagine from your perspective, you already had in your mind, I'm going to have this core, I want to do this, this, and this as quickly as possible, and build for that in a seamless way. So, you got the back office, the last thing they want is what's new. But at the same time, you have to know that with this core, we can do X, Y, and Z. And the faster we can get there, the better everybody's going to be.

Jim Marous (37:11):

So, from that perspective, how do you approach product development and innovation differently at Webster Five than what you've done in the past at other organizations?

Brian McEvoy (37:22):

Well, very differently. I think first and foremost, the scale is completely different. And so, in a community bank of my size, the senior management team, basically the CEO and direct reports we form the technology steer co, the al co, basically all the committees.

Brian McEvoy (37:51):

And so, there really is a tight-knit group of leaders that are working together closely all the time. And that's the same group that puts together the strategic plan and works through the budget every year.

Brian McEvoy (38:10):

And so, we're very aligned on where the bank is going and where we want to take the bank. The direction of the bank is not in question. And I think not having the layers and kind of having the breadth or the depth of kind of managerial leadership makes it easier in a lot of ways, frankly.

Jim Marous (38:34):

Yeah. Oh, definitely. Yeah.

Brian McEvoy (38:36):

So, that's been a big differentiator. But also, flip side of that coin, that empowerment coin, if you will, because I'm empowered to innovate and deliver new products. There's an accountability as well. Like there's no one left to blame if it doesn't get done.

Brian McEvoy (38:55):

And so, that's very different in that the people that run the day-to-day business are also the people that or the run the bank people, or the change the bank people. And so, we've got to manage both. We need to keep the wheels on make sure that during a global pandemic or a recession or whatever, that we're taking the appropriate measures to secure the future of the bank but also look at what's next.

Brian McEvoy (39:31):

And not only just what's next, what's exciting about what's coming down the road, but what are the challenges and what do we need to be prepared for? What are the impacts in the environment that the risks that we need to be looking at.

Brian McEvoy (39:43):

How does something like, and I know you've talked a lot about this on your podcast Jim, but something like AI, what is the true impact of AI and not just talking about gen AI, but AI in general, and where does it live in your partner solutions, in your technology? How are your employees using it to your advantage and to your disadvantage?

Brian McEvoy (40:11):

So, a big part of how I would say we approach product development and innovation is really from a standpoint of continuous learning. Making sure that we're staying abreast of industry trends. We're talking to the right people in the industry.

Brian McEvoy (40:30):

We host listening sessions with our employees because they're seeing as much, if not more on the ground than we're seeing. And just trying to understand what's happening around us and utilizing those inputs to make sure that we capture those in our strategy going forward. So, it's a lot more organic, I guess.

Jim Marous (40:54):

Yeah. So, if we wrap this up, what excites you the most about the future, and alternatively, what keeps you up at night?

Brian McEvoy (41:08):

What excites me the most about the future is, I think as we've been talking about here today, there's really been a democratization of technology. And so, I feel like a bank of my size can effectively compete, whereas 5, 10 years ago, I was more doubtful about it.

Brian McEvoy (41:33):

You always hear that Chase spends $15 billion a year on technology or whatever. And so, how can you ever compete with them, especially as there's more and more of a shift towards digital and they invest more every year than really the valuation of our bank. And to me, I think that issue has, I don't want to say it's gone away but it's been a lot easier.

Brian McEvoy (42:00):

Lately, we've been able to innovate with our technology and I think have market competitive products and solutions both on the consumer and the business banking side.

Brian McEvoy (42:11):

I think I mentioned earlier we stood up a treasury management platform that we've got some serious commercial relationships that carry significant balances, strong cash management service opportunities, et cetera. And we're a billion and three. But we're winning some relationships that ordinarily would go to a Bank of America or something like that.

Brian McEvoy (42:40):

So, that's exciting to me because I really feel like we're primed to compete. And I think the community banking space in general, is going through a bit of a renaissance period, there is a focus on innovation.

Brian McEvoy (42:55):

We've been effective in acquiring talent. I think community banking in general has, but certainly, a Webster Five. Even if you look at our employee mix it's probably at this point more majority millennial and Gen Z, which you wouldn't expect from a billion-dollar community bank.

Brian McEvoy (43:18):

So, I think the future is bright. We've got great talent, and we've got great technology. And I really feel like in this environment, people are looking for that community connection. So, we've got a good value prop.

Brian McEvoy (43:35):

To your other question, what keeps me up at night is, it's increasingly difficult to compete at this scale. Just from a cost perspective, your technology costs are going up, your employee costs are going up, benefits, everything. And so, the margins kind of get slimmer and slimmer. So, scale becomes even more important.

Brian McEvoy (44:05):

We've been able to successfully grow at a clip that we're pretty happy with. But there's also a pretty significant wave in the mutual community bank space of a mutual holding company tie-ups. And so, I think the competition around us is getting larger and has more opportunity for leveraging that scale.

Brian McEvoy (44:36):

And so, I guess that's what keeps me up at night is, we want to make sure that we're staying on the cutting edge and that we're not falling behind the curve and our competitors are taking notice and bulking up.

Jim Marous (44:52):

Brian, it's been great. As my team knows, we love talking to smaller financial institutions that are punching above their weight. And you're a great example.

Jim Marous (45:03):

I appreciate you being on the show and it's always good to talk to a commercial banker that's been in the biggest organizations and taking different pieces of what you've learned and now deploying it at a community bank.

Jim Marous (45:17):

And being able to do it, as you said, the ability to have partnerships and collaborations that really allow you to bring almost anything to your customers that the big banks can, with as long as you have the right mindset at the top.

[Music Playing]

Jim Marous (45:30):

I mean, again, it takes great leadership and the buy-in of your employees, and obviously you've done really well in that space. You just mentioned about your ability to acquire and keep good talent. If you weren't doing it right, the talent wouldn't come, it just wouldn't. It's nice to work for a nice, warm, fuzzy organization that's really good in the community, but at the end of the day, you want to have fun and be able to do new things.

Jim Marous (45:54):

So, congratulations on your personal transformation, but also the transformation of Webster Five. Appreciated the conversation.

Brian McEvoy (46:00):

Thank you, Jim. I appreciate the opportunity. I've been a big fan for a long time. So, thanks for the invite.

Jim Marous (46:08):

Thanks for listening to Banking Transformed, the top podcast in retail banking and the winner of three international awards for podcast excellence. We appreciate your support. If you enjoy what we're doing, please take some time to show some love in the form of a review.

Jim Marous (46:23):

Also be sure to read my recent articles on The Financial Brand and look at our recent research we've done at The Digital Banking Report. This has been a production of Evergreen Podcasts. A special thank you to our senior producer Leah Haslage, audio engineer, Chris Fafalios and video producer, Will Pritts.

Jim Marous (46:41):

I'm your host, Jim Marous. Until next time, remember, smaller financial institutions are well positioned to leverage local roots while providing the most advanced products and services.