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Glenwood State Bank – With a Purpose of Positively Impacting Their Customers, Employees, and Communities Through Christian Principles

Peter Nelson

President

Glenwood State Bank (Incorporated)

Interview conducted by:

Bud Wayne, Editorial Executive

CEOCFO Magazine

Published – November 20, 2023

CEOCFO: Mr. Nelson, you have been with Glenwood State Bank since January 1996. With a BA in Accounting, and some of your early working days in auditing, what led you to banking and specifically to Glenwood State Bank?

Mr. Nelson: I got into public accounting because of my love of numbers and my love of people. Banking also accomplishes those two things. The real reason I ended up in banking was my girlfriend, who eventually became my wife; her family owns Glenwood State Bank. Falling in love with her, gave me my start in banking.

CEOCFO: Would you tell us about your role at Glenwood State Bank and how it developed to where you are today as its President?

Mr. Nelson: When I first came to the bank, I was in the Controller. I then moved to CFO and, eventually, to President. I am a CPA by trade so I had a natural passion for numbers. As I learned other aspects of the banking business, I realized there is a lot more to it than just numbers. In 2006, my transition to President made sense because of my passion for community banking—and people.

CEOCFO: Would you give us a little background and history of the bank and how it developed from its founding? Has the vision changed much from its founding vision?

Mr. Nelson: The bank started in 1907 in Glenwood and had just one location. It operated out of that location for a few decades. My father-in-law started at the bank in 1959 and he, along with two of his coworkers, ended up buying out the ownership in the late 1960s and early 1970s. Eventually, my father-in-law bought out his two partners and our family now owns 100% of the shares.

Our purpose is to positively impact our customers, employees, and communities through Christian principles. It is purely about serving those who are either working with us or the customers that we serve. That vision has not changed since I started in 1996. We have probably gotten better at articulating it and maybe a little more focused on just that. That is our vision. We want to continue to remain a family-owned bank and take care of the community that we serve and make them as viable as possible.

CEOCFO: On the bank's Facebook page there is a video titled, "Meet Our Dream Team." What about your team today is special and have there been any significant changes to your team over the past few years?

Mr. Nelson: What I love about our team is their commitment to what they do. They could all choose to work elsewhere but they understand what we are trying to do here: make a positive impact. I think that resonates with them. We have a great staff that has great hearts and amazing minds. We hire the heart and train the brain. That is what makes our “dream team” special.

CEOCFO: In October 2021, Glenwood State Bank was named 2021 Minnesota Family Business Award Honoree, and in 2020 the Star Tribune named the bank a Top 150 Workplace. Why are these awards significant to you?

Mr. Nelson: At the end of the day, we want to be a place that people feel proud to work for. Our employees spend a lot of time here and we want to make sure it is time they feel good about and not just wait around for Fridays.

Our employees are our #1 asset, so we want to invest in them and make sure we are treating them well because they work hard for us. We want to make sure we reciprocate that effort. We encourage work-life balance by offering flexibility and good benefits and we also put a lot of time into training. There is a lot of self-awareness education that we do. I think that when someone understands themselves it goes a long way to making them successful, happy, and fulfilled. This impacts others too. It’s easier to give grace and patience when you know each other and yourself.

CEOCFO: You have branches in Pope and Douglas Counties in Minnesota. Would you tell us about the communities that you serve? Are they more rural or urban? What changes have you seen over the past two years?

Mr. Nelson: We serve Glenwood, Alexandria, and Villard. Glenwood and Villard are rural, agriculture communities primarily. Though I have not seen population growth, I think they are doing well and are vibrant. We also serve Alexandria, which is more of a regional center, with a population of about 14,000. This area has many, many lakes so a lot of people like to spend their summers here. I think the people who choose to live here are here for the people—they are honest and have integrity. You know your neighbors; you celebrate with them, you cry with them, you live life with them. We have special people here.

CEOCFO: In Glenwood and Alexandria you have retail businesses, restaurants, home builders, farms, medical centers, churches, and manufacturers. Which industries would you say are the backbone of the community, providing jobs and community development?

Mr. Nelson: Agriculture is one of the staples to our economic engine for sure. Manufacturing is also huge; they employ thousands of people. Our public facilities, government, and schools are critical. We also have great medical facilities for communities our size. We are very blessed.

CEOCFO: Which of the different industries that you serve provides the greatest revenue potential for your bank today? Is Ag lending important for you?

Mr. Nelson: It might depend on which branch we are talking about. As a whole, agriculture and commercial real estate/commercial business are a big part of what we do. As well as 1-4 family housing. However, each branch/town is different.

CEOCFO: How do you meet the challenges of Ag lending?

Mr. Nelson: During the 1980s, we learned a lot about how to help our producers be successful. If you are going to lend in the agriculture world, you need to be all-in for the long haul because there are good years, bad years, and a lot of mediocre years. You have to be patient and help that customer get through those tough times because eventually, about 90% of the time, it works out well.

CEOCFO: On your website, you emphasize technology. Why is tech important and how do you keep up?

Mr. Nelson: Technology is our friend and it has allowed us, a small-town community bank, the ability to do things that larger institutions can do. We have pretty much the same things as the Big Banks, but we also have personal service. You can have your cake and eat it too. For example, just last weekend someone needed several thousand dollars in cash on a Sunday night to buy a trailer. We were closed—like most banks—but we got him his cash and he purchased his trailer. He couldn’t have called the President of Wells Fargo and made that happen.

So, technology is very expensive, but it allows us to level the playing field with our big competitors and keep us in the game.

CEOCFO: Are you more of a business/commercial bank than a consumer bank? What is the mix and would you like to see that change?

Mr. Nelson: Technically, if you look at our loan volume, we are about 75% commercial and agriculture. Of the 25% consumer loans, most of those are 1-4 family residential. I would like to think that we loan out what the demands are locally. For the loans that are outside of our community, most of those are commercial.

CEOCFO: How many branches do you currently have and are you looking to grow that number shortly?

Mr. Nelson: There are three locations in total. I think if the right opportunity came along, we would certainly think about growing that number. We also own two other small community banks that are in our area. They are standalone banks, meaning they are one-location banks. So, in total, we have five locations and largely we work together to carry out our purpose of serving our communities. These partnerships also give our employees room to grow, the ability to share technology, and a lot more. It works for us.

CEOCFO: Do you have a marketing person or team? If so, what is their role? Is it community relations messaging, helping pitch your products and loan offerings or a mix?

Mr. Nelson: We are actually in the process of restructuring our marketing department because marketing as changed a lot over the years. There is traditional marketing—like newspaper and radio. But then social media is obviously a huge medium now, which is entirely different. In addition, as a community bank, we are very involved in the community. It’s almost a full-time job coordinating all of the fun events we participate in. Not to mention, we’re operating in five communities (if you count our sister banks) so it just requires a lot of time. Graphic design requires a much different skill set than writing radio ads or coordinating volunteers. We are excited to redefine some roles and add more horsepower to this department.

CEOCFO: What is your current funding position? Are you well-capitalized for the future of the bank and its customers?

Mr. Nelson: We are well capitalized, by our standards and by regulators' standards. However, we are always looking for more deposits because 100% of our deposits get turned into loans. Many community banks are structured this way. So, the more deposits we have, the more we can help people with loans for homes, engagement rings, or even medical bills. Similarly, we can help a business start-up, or inject more capital. Investment firms are changing the model a little bit, because they do not loan that money out—and they do not keep it locally. By loaning out 100% of our deposits, we do assume some risk, but that is where a strong loan policy and great people come into play; we do a good job of mitigating that risk and making sure we get paid back. Diversification is important too—types of loans, as well as geographic.

CEOCFO: In closing, you are a numbers guy, yet your values seem to have made the greatest impact on the bank.

Mr. Nelson: That makes me happy that you can see that in our 45-minute conversation. I think you are accurate. At the end of the day, we believe this is God's bank and it is His asset—we are merely stewards of those assets. In fact, we pray before meetings and ask for his help to be good stewards. If you think it is “yours”, then you make different decisions. We think of it as His so we continue to be humble and appreciative of His blessings. Then, our responsibility is to decide how to use those blessings. We do this by giving back to our communities and taking care of our customers and employees. Positive impact is what we are striving for, not focusing on the bottom line.


Glenwood State Bank (Incorporated) | Commercial Banks Minnesota | Peter Nelson | Glenwood State Bank – With a Purpose of Positively Impacting Their Customers, Employees, and Communities Through Christian Principles | CEO Interviews 2023 | Banks Minnesota

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