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Heritage Bank of Nevada |
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August 21, 2017 Issue |
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CEOCFO MAGAZINE |
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Heritage Bank of Nevada finding Success as a True Community Bank serving Small Business and Personal Banking Customers |
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Stanley Wilmoth President and CEO
Heritage Bank of Nevada
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – August 21, 2017
CEOCFO: Mr. Wilmoth, every bank has their own philosophy, would you tell us about Heritage Bank of Nevada? Mr. Wilmoth: Heritage Bank was started in 1995 by a group of 365 families in Northern Nevada in order to have a community bank in this market. The bank was successfully run by the group until 2000 when a new management team took over and things have been off to the races ever since.
CEOCFO: Would you tell us about the range of services you provide? Mr. Wilmoth: We provide all of the business and consumer products and services the big banks offer, and we focus primarily on serving small businesses. In northern Nevada, we have the reputation as the place to go if you want to get it done quickly and seamlessly. If you do, you come to Heritage Bank. lt has never been about price with us. People come here because they know us, we are their neighbors and their friends. My Mom once asked me why I bank with friends after we had a foreclosure on some neighbors. I told her that people that bank with us end up becoming our friends and that is a lot of people in northern Nevada. Ms. Tedore: The downturn in 2008-2014, really allowed us to prove who we say we are. All banks, including the big banks, say they are great banks but it does not take much to be a great bank when things are going well. It does take a very good banker and bank to be great when things are not going so well; to get out there and understand the business that you are banking, to understand their needs and try to fit their cash flow into a loan that makes some sense and has a high probability to be collected during bad economic times.
CEOCFO: Would you give us an example of how you handled a situation differently from the typical banking perspective? Mr. Wilmoth: One good example is that of a roofing supply company here in northern Nevada that was challenged during the downturn when no one was building houses and no one was reroofing their homes because they had no equity in their houses. In Nevada, we saw no less than a 60% decrease in home values. It was enormous, it was an economic tsunami here and it was horrible. This gentleman wanted his sons to take over the business during the worse time of the recession. We met with them numerous times and were able to understand the substantial decrease in top-end revenue they were experiencing even though they were still making money. We knew that we had to stretch their payments out dramatically in order to allow them the flexibility to pay us back. We used the SBA 7(A) loan program and the SBA 504 loan program in combination and were able to take their remaining debt and stretch it out over a longer period of time. They were also able to sell some assets reducing their debt and the demand on cash flow, allowing them to support their reduced loan payments. Now with the economy back in high gear in northern Nevada and the company is doing well. Houses are being built all over the town and people are now reroofing their homes after holding off during those six or seven years and deferring the maintenance until now. The company has come out of it and is now stellar which is very good for all of us.
CEOCFO: You have been the #1 SBA lender for many years running. What do you understand about SBA that has made it a positive force for you and for your customers? Mr. Wilmoth: We are the #1 SBA 504 lender in the state for the sixth straight year. We really make SBA loans because the primary purpose of that program is to generate jobs and that is one of the things we try to tell our legislators that we need more of. As a result, we are enablers of jobs because 85% of all jobs that are created in northern Nevada are created by small businesses and that’s who banks with us. The SBA 504 program was put in place specifically by Congress to allow companies to buy fixed assets and buildings and equipment, and stretch their term out over a longer period of time in addition to requiring a lower down payment. And the government, through the debenture sales, funds 40% of the loan at a fixed rate for twenty years.
CEOCFO: What is the competitive landscape? Mr. Wilmoth: With the technology that we are seeing today, we have seen a lot of banks reaching out into our market because it is a desirable market with all that is going on in northern Nevada with Google, Tesla and Yahoo, and everyone who is coming in here. The new banking technology and internet banking that is now available allows others to come in here without really having a brick and mortar presence. We are seeing more internet banking today as well as new competitors. Even State Farm has its own bank. Because we’ve built this relationship with our customers, it gives us an extra layer of protection against others coming into our market and targeting our customers because our customers have a strong relationship with us; they see me at the grocery store, they see our lenders at their schools and their churches. They are our friends and our neighbors. Of course there are those folks that are rate sensitive and sometimes other entities will bid a deal far lower than we are comfortable doing. But overall, I do not think we have a whole lot of competition, and that is mostly because of the scarcity factor of community banks located in northern Nevada. There are a couple of small banks that have satellite branches here in our area but they do not concern me at all.
CEOCFO: How do you help your customers with security issues? Mr. Wilmoth: We are continuously training and testing our own employees on security compliance. We also communicate with our customers almost daily, and we call our customers when we think things are not right. We have a lot of security programs in place within our computer systems that house our customer accounts, and those systems are always kept up to date, as well as the debit card and credit card systems. We have not only internal security programs in place, but we also have a product called CardValet that the customer can use to manage their own debit cards and turn them on and off and allow transactions only in certain locations and during the times designated by the customer. With CardValet, the customer can literally manage how much is on that card, the zip code is used in, and the times that it is used so if there is any fraud going on, they can see it right away. And while we do pay for the CardValet service, we give it to our customers at no charge because we value their security. We have a lot of security products and services and we are going to be adding additional alerts. We are always looking for the latest in technology that is available for us to give to secure our customers’ accounts.
CEOCFO: Do you do much advertising or outreach for new business or do people know you and come knocking at your door? Mr. Wilmoth: I would say we do a lot of advertising, not as much as Audrey would like us to do, but we also send branch managers out constantly to talk about our bank within the community. What happens is you get good name recognition out in the market along with a great reputation and our referral sources are happy to refer their clients to us. They know who we are, what we can and will do, and the time it will take us to do it. Ms. Tedore: We focus on brand marketing, not on product specific marketing. Our brand is all about the local person that you can come talk to, so whether I am featuring Stan in one of our ads or our chief credit officer, people see them and get to know them. It may be Stan saying, “We are your neighbor, we are your friendly banker,” and people will come to us. They feel the already know us because they see us on TV or hear us on the radio. We do a lot of testimonial ads with our customers endorsing us and saying what a good experience they have working with us. Our brand is the local, friendly, reliable community bank that offers the latest in products and services and that everyone in town knows. Mr. Wilmoth: We have advertised my home phone number all over town. When the bank phone rings and if it is after hours, it rolls to my personal cell phone which is on me and I answer it 24/7. If it is 3:00 in the morning, I am answering that phone. The reason that is important is because it is something that other banks will not do and it speaks volumes about the customer service at Heritage Bank. The issue that I think is the biggest frustration for me as a customer calling other businesses, is when I get shifted to some phone bank somewhere and then I get shifted two or three more times. When you call Heritage, you get someone who can assure your questions are answered and can see that you problem gets resolved.
CEOCFO: What is next for Heritage Bank in Nevada? Mr. Wilmoth: If it were not for the fact that we are achieving incredible growth, which by the way can be attributed to the team of professionals we have in here northern Nevada, we would probably have to look somewhere else to grow. We are to a point now at $750 million, where the market is growing rapidly, and we have a great reputation coupled with our substantial growth, that we can push forward into $800 million to a billion dollars fairly rapidly, and we think it could happen within two years.
CEOCFO: It is exciting times for the bank! Mr. Wilmoth: It is fun! At 65 years old, it is an exciting time to be in the twilight of my career and to be able to work and watch people who work with us to grow this bank and see the market growing as fast as it is growing today. |
“We really make SBA loans because the primary purpose of that program is to generate jobs and that is one of the things we try to tell our legislators that we need more of. As a result, we are enablers of jobs because 85% of all jobs that are created in northern Nevada are created by small businesses and that’s who banks with us.”- Stanley Wilmoth
Heritage Bank of Nevada
Contact: Audrey Tedore Titus (775) 321-3505 atedore@heritagebanknevada.com
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