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MAY / JUNE 2019



Chase Bank Marketing

The Best 5 Ideas You Need


B Corporations

Does the Designation Drive Deposits? June 28, 2019


Pages 20-21


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Roxann Cooke outlines how Chase is going to be No. 1 in New England

Our news roundup from Banking in New England’s weekly newsletter




Bank Design



What’s popping in bank branches in the near future


Letter from the Publisher


New England’s first quarter good in spite of Massachusetts




Five Focuses You Need


Gregg Rosen, NES Group, and Chris Gill, Diebold Nixdorf

Try To Keep Up

Anything but Banking

See who’s career is on the move in New England



Is this designation worth the investment?


Vince’s Letter



B Corporation


Did You See?



Bob Montgomery-Rice Bangor Savings Bank

The Economy

The challenges facing New England




Cover photo: Keith Griffin



Being The Best, Measure By Measure


anks are not loved. Banks (and credit unions) are necessary. Banks provide critical financial services to their communities. Banks are important. But loved? No one’s lining up for new checking accounts the way they line up for new iPhones. But that doesn’t mean banks can’t be shown a little love, sometimes. This month, American Business Media is hosting the second annual New England Banking Choice Awards, as an integral part of the new Best Bank Expo event. Included in that day-long guide to best practices is a panel of Banking VINCE VA LVO Choice Award winners discussing their views on what it takes to be at the top. Success will surface when you bring your best. In this case, the best were those chosen by consumers throughout the region. Banking New England magazine teamed with Customer Experience Solutions. CES is an independent research firm that routinely surveys tens of thousands of local consumers on their banking preferences. These surveys are conducted using the strictest methodology to ensure accuracy and to eliminate bias. They form the basis for the popular Banking Benchmarks report relied on by many of the region’s banks and credit unions, because this is the most reliable data on consumers’ true feelings toward their banking relationships. CES’s survey asks customers a sizable number of questions about both their primary banking institution, and their perception of other others that they are aware of but not a customer of. Analysis of their responses delivered ratings for each institution in four areas: customer experience, technology, contribution to the community, and overall quality. And when asked, those consumers said they really prefer the banks that get it all right. So here was the takeaway: it’s true that banks don’t get much love. But that doesn’t mean consumers don’t appreciate their institutions, when those institutions are working hard to make their customers love them.




CEO, PUBLISHER & EDITOR Vincent M. Valvo ASSOCIATE PUBLISHER Barb Dimauro MANAGING EDITOR Keith Griffin OPERATIONS MANAGER Kurt Schenher ONLINE CONTENT DIRECTOR Navindra Persaud GRAPHIC DESIGN MANAGER Stacy Murray GRAPHIC DESIGNER Scott Ellison Interested in receiving additional copies of Banking New England? Call (860) 719-1991 or email ©2019 American Business Media LLC All rights reserved. Banking New England magazine is a trademark of American Business Media LLC. No part of this publication may be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without written permission from the publisher. Advertising, editorial and production inquiries


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New England FDIC Insured Banks Show Healthy 2019 First Quarter Profits By KEITH GRIFFIN


ew England commercial banks and saving institutions insured by the Federal Deposit Insurance Corporation saw their net income grow by $51 million for the first quarter of 2019. That reflects a 2.8 percent growth in net income. Results were strongly dampened, though, by a $105 million drop in net income in Massachusetts from the first quarter of 2019 compared with the first quarter of 2019. Excise the Massachusetts figures and the five remaining New England states saw a 30.8 percent growth combined in net income. Massachusetts had about 50 percent of the net income in the first quarter in New England: in 2018 the percentage was 59.3 percent. The decline in Massachusetts is attributable to a $151 million drop in net income available to shareholders at State Street, according to Peter Ostrowski, managing director of Ostrowski & Company Inc. “If you take State Street out of the mix, the other banks look pretty good,” he added. When announcing first-quarter results, State Street CEO and president Ronald O’Hanley said, “Our performance this quarter reflects the continued challenging conditions in the industry as well as lower client activity. We have seen these conditions before and know that focusing on what we can control, including better productivity, process reengineering and greater resource discipline, while also strengthening client relationships, will deliver shareholder value and drive growth. The expense program we initiated in the fourth quarter of 2018 is already delivering benefits.”

Nationally, FDIC-insured commercial banks and savings institutions reported aggregate net income of $60.7 billion in the first quarter of 2019, up $4.9 billion (4.9 percent) from the same quarter a year ago. FDIC Chairman Jelena McWilliams said the national picture reflected growth in net income mainly attributable to higher net interest income. McWilliams struck a note of caution. “With a historically low interest-rate environment and strong competition to attract lending, some institutions have ‘reached for yield,’ which limited net interest margin expansion. With the recent stabilization of interest rate hikes, some institutions may face new challenges in lending and funding. Therefore, banks must maintain prudent risk management in order to support lending through this economic cycle,” she said in a statement. Here is a state-by-state look at the combined net income of FDIC-insured financial institutions in New England, according to government statistics.


Maine ended the first quarter of 2019 with $79 million in net income compared with $66 million in 2018 for a 19.6 percent increase. Maine had 26 institutions reporting quarterly results to the FDIC for the first quarter of 2019: the same as 2018.


For the first quarter of 2019, Massachusetts had $900 million in net income compared with $1.05 billion for the same time frame in 2018 for a 9.9 percent decrease. There were 120 institutions reporting quarterly results

to the FDIC for the first quarter of 2019 in Massachusetts compared with 123 for the same timeframe in 2018.


Connecticut in the first quarter of 2019 saw $326 million in net income compared with $283 million for the same timeframe in 2018 for a 15.1 percent increase. Connecticut had 38 institutions reporting quarterly results to the FDIC for the first quarter of 2019 compared with 41 in the first quarter of 2018.


At the end of the first quarter in 2019, Rhode Island had $482 million in net income compared with $342 million for the first quarter of 2018 for a 40.9 percent increase: the largest percentage increase among the New England states. Eight institutions were reporting quarterly results to the FDIC for the first quarter of 2019 in Rhode Island.


New Hampshire reported $22 million in net income for the first quarter of 2019 compared with $19 million in 2018 for a 15.7 percent increase. There were 17 institutions reporting quarterly results to the FDIC for the first quarter of 2019, down from 18 in 2018.


Vermont for the first quarter of 2019 reported net income of $13 million compared with $10 million for the first quarter of 2018 for a 30 percent increase. Vermont had 11 institutions reporting quarterly results to the FDIC: The same as 2018. ■ May/June 2019 | BANKING NEW ENGLAND 5


Chase’s Roxann Cooke Banking On Recognition, LMIs for Success In New England



oxann Cooke is the new managing directorregional director for consumer banking & wealth management at JPMorgan Chase Bank in New England. She is tasked with opening 60 locations across the region. Cooke has an undergraduate degree from Dartmouth and an MBA from Suffolk University’s Sawyer School of Business. A native of Jamaica, she immigrated to the United States when she was 10 and lived in the Grove Hall neighborhood in Roxbury, Mass. She sat down with Banking New England to discuss her plans for the bank in New England, which includes opening 60 branches in Massachusetts, Rhode Island and New Hampshire in five years (plus ATMs in Maine), as well as what brought her to Chase after nine years with Eastern Bank as senior vice president and regional manager. This is an edited version of the conversation.


Q. You are responsible for Chase’s market expansion plans. What are some of the immediate steps that you’re taking for that market expansion? A. My first priority is making sure that the team members that come on board, are the team members that are going to bring that same vision, mission and philosophy of Chase, and that same purpose of why we are here. We are here to give back to the community. We are here to add to the community. I am looking for the 350 people that we’re looking to hire are going to be people of integrity, people who know how to build relationships and network with customers. That’s the people piece, and the purpose piece, and then the places is really figuring out with real estate, and the team, where are the locations where we want to put our brand and where are these communities that have been at times, underserved and overlooked?

So, I get to have those types of conversations to say, “Here are some communities that were underserved and overlooked, and how do we add and bring that?” We already have a brand visibility here with the million customers that we’re already serving. How do we deepen and penetrate that, how do we bring the full force of JP Morgan Chase, One Chase philosophy of all the other aspects of our business and really introduce it to our market now that we’ll have the retail piece that will really round our presence in the New England marketplace? Q. How much of an investment is Chase making in its branch expansions? A. I can’t speak in terms of cost. Here’s what I will say in terms of investment, because this is how I look at it from that perspective rather than the monetary piece is, the location. As you know some places are closing, right, so for Chase to come and say, we are planning to come and put physical presence and branches there, that’s a huge investment. So that was important for me, the 60 branches that we plan on investing in, but the other piece though, that’s even more dear to me, is the corporate responsibility and the philanthropy that we are bringing, and the dollars that we are bringing to these marketplaces. And the way when we’re focused really on job skills and development right now, and even prior to learning that was one of the

pillars that we we’re working on in this territory. For skills development, we’re partnering with our corporate philanthropy partners and investing these dollars and they’re doing a lot of job training and development, and skill enhancements. And not just for jobs in the financial industry, but across sectors because I believe that it’s not just the financial sector. So far, Chase has invested $1.1 million in jobs skills programs. Chase is committed to a minimum of $18 per hour, plus benefits. So when we think about those 350 people that we are hiring that will get the benefit of that, when we think about the programs for job skills and the development that we’re doing to give people an opportunity to have and earn living wages that help them and their family, so it’s not just about Chase, and Chase succeeding. It’s these individuals succeeding, and ultimately, their families succeeding and then creating this bigger picture of an economy here in Boston. Q. Why does Chase think brick and mortar expansion’s going to work when it’s not working for a lot of banks? They’re pulling back on locations. A. Branches remain critically important to our business unit. Our customers’ needs and their patterns have changed a little, yes. We need to make sure that we are adept and managing that. We find that on average, twothirds of our customers still visit the branch network at


least once a quarter, or four times a year. Seventy percent of our deposit growth comes from customers who visit our branches. Sixty percent of our deposits will come from customers who use both digital and branch. Branches are relevant, and remain critically important, but we also need to listen to our customers’ needs and incorporate the digital aspects of that as well with the ATMs that are capable of doing 70 percent of the routine transactions. When you have ATMs that can do 70 percent of the routine transactions, it frees our staff members up to be able to build a relationship with the customers and have those conversations. Customers come in, they want to talk about retirement needs, they want to talk about investments, they want to talk about education, they want to talk about, “How do I own a home or how do I start a small business?” Technology may give them some of that, but they really want that face-to-face time as well. Customers want the choice, and that’s the end of it. They want the choice, they want to bank how, when and where they want to choose. They want something that’s convenient, and convenient for them. So that includes brick and mortar. Q. Does it get too expensive? This is a broad generalization but retail’s closing because consumers are buying online. When does it become too expensive for banks to keep brick and mortar open if you only get customers stopping in two or three times a year? A. That’s why you have to be strategic about it. You can’t come into a marketplace and say I’m going to open 500 branches. You have to be selective about where, and you have to now incorporate some of the digital aspects of that. You have to be really smart about how you choose to come into a market, or what you choose to do in that marketplace. You can’t go in without understanding how customers are banking. Q. I read somewhere that one of the reasons Chase didn’t want to acquire a bank was because you won’t necessarily get the branches where you want the branches. A. I think that was a great move, a great strategy. Some might think that is probably one of the more expensive strategies in terms of how you’re going to attract customers. But what worked for Chase is Chase already had customers here. Banks buy other institutions just to buy that wallet share and buy that deposit, then buy the customers. We have existing customers. We just needed to put the places here. We had volume, and that’s because of that brand recognition. Q. So about a decade ago, Citigroup tried it and failed. What’s going to be different about Chase that it doesn’t end up selling its branches in 10 years? A. I think a couple of differences there, right. We are committed for the long haul. The strategy that we’re coming in with, understanding that it’s not about coming in and adding 500 branches in brick and mortar, it’s coming in and having a balance of the brick and mortar, 8 BANKING NEW ENGLAND | May/June 2019

and having a balance of the digital capabilities and evolving that. So those are the two things I think that’s going to make us successful. The differentiator for Chase is one, the Chase brand, but the second piece is, we already have a million customers here. Q. Jamie Dimon, chairman and CEO of JPMorgan Chase, has said he isn’t entering New England to be in second place, which probably means taking down Bank of America. How long before you think that happens? A. So here’s what I will say to that. I’ve worked for all of those other banks. And I have respect for all of those other banks. I’m focused on Chase. I’m focused on Chase, and it’s not about coming in and taking anybody’s deposit share or market share. Q. But you have to. A. I don’t look at it as taking. We’re going to gain market share, but we’re going to gain market share because of what we’re going to give to the market. And so that’s how I see that. It’s going and focusing on one community at a time. What that community needs, how do we go in and what’s happening in that community that we can go in, and be a partner and change that community. So, I know it’s going to happen. It will happen that we will gain this market share, but I’m not immediately focused on number one, number two, number three, number four. It’s, how do I win one customer at a time? So if there is ever a number one that I want to be a number one in right now, it’s customer satisfaction, it’s employee satisfaction. Once I work on being number one in those two things, the other number ones will follow. I will gain market share. We will be number one in those pieces because we’ve hired the right staff that’s going to deliver to our customers. Q. What about like in, as you talked about the LMI areas, it’s tough to make a buck in those areas. A. And so people think, that’s the perception, right. The companies who are moving into these market places, right, and it’s no secret that people are understanding that secret. So my career started in a bank, Bank of Boston. And there was a Harvard business case about that bank where that bank went into these LMI communities that were under served and under banked, and the business model showed that they were profitable. It’s about going in and doing the financial literacy with these customers. It’s about understanding the needs of these communities. You can’t go in with the same process that you may take across the board. You have to go in and understand that, and these communities, they have some historic things that’s happening, and you have to get to the hearts and the minds of these customers. When you do that the right way, those customers are going to come, they’re going to transition from other ways of where they weren’t thinking before. If you educate them on what is banking, how does banking work, what are your hopes, CONTINUED ON PAGE 10

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It’s about understanding each particular customer and making the needs match to that particular customer. –Roxann Cooke dreams and fears, and really, I think work with them, this is where the relationship is going to be more important right, because there’s going to be a lot of the educational aspects of it. A lot of these communities, I still live in one of these communities, so there’s these perceptions about these communities that really isn’t a reality when you live and embrace, and are a part of that community. There are a lot of resources, not just wealth in the terms of assets, but wealth in the terms of people. The banks that understand that, and the banks that go in there and want to do the right things, are the ones that’s going to be successful. And that’s Chase.

successful ... And I like to prove people wrong. It’s not just for CRAs for us, right, it’s a community reinvestment, not community reinvestment act that we have to tick off. For us, it’s about community reinvestment. Q. Are you targeting the low to moderate-income customers? It seems like you are with the Chase Secure [a product targeted to customers who couldn’t open accounts previously] that targets those who don’t have banking relationships currently. A. For me, it’s not targeting anyone, and even with Chase secure, it’s not justQ. Well, marketing’s all about targeting. A. It’s not just for the LMI, it’s for customers who may not have had an opportunity. So they may have had a blemish overdraft history where they can’t now open an account. That Chase Secure allows them to do that. So for us, in terms of from a targeting perspective as we go to these communities, it’s, what are the needs of these communities? So it’s not targeting one particular product versus the other, and it’s not that we’re going to focus on one particular product versus the other because in each of these communities, there are various needs as well. It’s not just one particular need. People of various income level and various asset level live in these communities, so for us, it’s about understanding each particular customer and making the needs match to that particular customer. ■

Q. With Chase saying 30 percent of the branches will be in low to moderate-income areas, It’s going to take you more time or focus just because consumers there may not have had the credit cards, and the other Chase products? A. In terms of length and duration, yes, it may. So I can’t speak to the Successful leadership means knowing both the strategies that work penetration, but I will say there is demand elsewhere. today and the people who will implement them tomorrow. To help Some of these customers you, your business and its future leaders succeed, tap into these are coming to our locations forward-looking leadership development opportunities from ABA. downtown. So I know without a doubt that there’s going NEW! to be success. I just opened, Community Bank Online Training Suites from my previous employer, With input from bank CEOs, we’ve put I opened one in Roxbury, and together our most popular, short and concise, I think what the numbers online training courses into specially priced are showing is the growth bundles starting at $95! that’s happening in these LMI communities right. People are starting to take NEW! notice and are starting to go Emerging Leaders Online Certificates in because there is lots of Top-tier online content featuring preeminent growth happening while the Wharton faculty. Attractively priced and will Boston economy is growing, fit into busy schedules. and so it’s impacting also some of these outskirts in some of these areas that’s central for Boston such as these LMI communities. So you’ll be surprised to see how

Good leadership requires two things.

10 BANKING NEW ENGLAND | May/June 2019

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May/June 2019 | BANKING NEW ENGLAND 11




By R. Michael Goman, Special To Banking New England

oday’s technology means most customers can pay their monthly bills in about five minutes without ever picking up a pen to sign their name. No stamps or paper checks required, and no waiting for “regular banking hours.” With a smartphone, laptop or home computer, moving cash between accounts now takes only a few mouse clicks. Direct deposit has largely eliminated printed paychecks. Even store refunds using hard cash is rare.

12 BANKING NEW ENGLAND | May/June 2019

Most customers don’t visit a bank branch with any frequency. And when they do -- to cash a check or withdraw a few bucks -- ATMs take care of basic needs. Even complex credit and loan approvals are becoming almost instantaneous. With all this transformative change, what will tomorrow’s bank look like, and what will we do there? Are traditional, ornate bank branches today’s granite and marble equivalents of the buggy whip -- once very useful, but now history? Not exactly. Banks will indeed look and feel different, but they will still serve important functions, and offer

enhanced personal services. Rather than a place to conduct transactions, bank branches will be places we go for personal advice and financial education. Undeniably, digital banking is taking over. Brick-and-mortar bank locations remain a critical sales channel, but smaller physical layouts and technology are transforming how customers will interact with bank employees. Traditional bank teller positions are disappearing, replaced by knowledgeable personnel who offer advice and can sell a full array of products and services. Meanwhile, the emergence of Big Data analytics

– which increasingly track and characterize individual and collective consumer buying patterns and preferences – will enable a more personalized customer experience. Greater convenience will be evident. Hours of operation will move toward 24-7. Interactive Teller Machines (ITMs) with full-service videoconference access will flourish, while payment options will continue to expand. Let’s look at how banks are already reinventing their local branches. One of the more intriguing innovations are so-called “popup” bank branches which can cost 10 percent of a typical branch! These self-contained spaces may be designed to fit within converted recreational vehicles or housed inside 20’ by 8’ steel containers (the kind typically seen on a truck bed or rail car). These portable offices feature on-site bank employees who use tablets to open new accounts, initiate personal loans, offer products and make service referrals. With relative ease, a “pop up” branch can be located where it’s needed. For example, a branch equipped with its own electric generator could serve an area suffering from a natural disaster. Such a branch can also test early foot traffic in a prospective location, allowing the bank to gain local customer insights and better “scale” a brick-and-mortar building. A temporary branch could also be a vendor at a country fair, sporting or other public events where the bank wants to enhance its presence and build brand awareness. Also, the traditional row of teller windows is quickly vanishing, replaced by kiosks or island service centers, staffed by professionals with tech at their fingertips. These “universal bankers” are focused on financial services and can help with all manner of banking business. Tellerless branches known as “virtual centers” or “smart branches” will employ no people on site. Instead, videoconference

The traditional row of teller windows is quickly vanishing, replaced by kiosks or island service centers, staffed by professionals with tech at their fingertips. capabilities and handsets will allow customers to obtain personal, confidential assistance with transactions or consult with mortgage loan officers or investment specialists in remote locations. Banks are also exploring contemporary café branches, where customers can access free Wi-Fi or web access, enjoy coffee, recharge their cell phones, withdraw money from an ATM, or talk to a banker for more complex assistance.

Branches are being co-located with other retail outlets – such as pharmacies and big box retailers – to reduce costs and enhance customer access. Many banks have gone a step further, offering their space for after-hours community activities such as investment classes or social gatherings to help build their community brands. As technology and consumer preferences continue to evolve, so will banks, from places of basic transactions to financial advice and service centers. These are exciting times for banks that choose to embrace change, innovate, and please tech-savvy customers who will seek banks centered around custom services and conveniences that fit their busy lifestyles. ■ R. Michael Goman is president of Accubranch LLC, based in East Hartford, Conn., which offers trusted advice to community banks and credit unions regarding branch locations.

May/June 2019 | BANKING NEW ENGLAND 13


B Corporation Might Be A Feel Good Designation



ust about everyone wants their bank to offer competitive interest rates, low fees and reasonable access to credit – not to mention good customer service. But is it important to bank customers which sources of energy the bank uses? Or where the bank advertises, or whether it buys from local sources? Or how much the bank pays its employees? A small but growing number of banks believe their customers do care about these things, which has prompted them to seek B Corporation certification from the Berwyn, Pennsylvania-based B Lab. 14 BANKING NEW ENGLAND | May/June 2019

A B Corporation certification, according to B Lab, is a company that’s agreed to adhere to the highest standards of social and environmental responsibility, as well as public transparency, legal accountability and a commitment to “balance profit and purpose.” That includes imperatives like maintaining generous wages, buying from local sources, environmental responsibility and many other things. It’s a comprehensive process that looks at a company’s practices with respect to environment, local sourcing, wages and many other things. Once an applicant company submits the information required, it will usually be subject to an audit on at least some issues before receiving

certification. While 2,788 companies across 150 industries have become B Corporations, only nine banks in the United States have done so. One of the most recent is Brattleboro, Vermont-based Brattleboro Savings & Loan, which completed the process and received its certification in December 2018. (Mascoma Bank in New Hampshire was the first New England bank with the certification back in 2017.) But while the certification demonstrates a company’s commitment to certain issues, the question remains just how the certification advances a bank’s business objectives. For Brattleboro Savings & Loan

president Dan Yates, local business because president at Brattleboro S&L. “So, the clear connection it advertised with a if you’re doing a little bit of good lies in the profile of local radio station, but for mankind and you can feel good the bank’s customers. B Lab pointed out in a about banking in our bank, do we “We have a subsequent audit that the think customers will beat down the progressive, activist radio station is actually door to bank with us because we’re population and owned by an out-of-town a B Corp? I don’t think we believe community,” Yates company. that, but the momentum is in that said. “And I think as “It’s not an easy direction.” more and more people process to go through,” Hannah Munger, a media find out about it, we Yates said. “And you’d spokesperson for B Lab, said the want to be able to ask better be doing a lot of certification speaks to a clearly the question: If these the things you could be Dan Yates, President expressed priority of consumers. Brattleboro Savings & Loan things are important doing.” “It signals to your customers, to you, are we worthy B Lab charges an employees, communities, and of consideration to be your bank?” annual certification fee based on suppliers that your business -- or Brattleboro is convinced it has the company’s annual sales. Yearly your bank in this case -- has met a customer base with a particular costs range from $500 for a company rigorous verified standards of social profile who will value the kinds of with sales under $150,00 to $50,000 and environmental performance as things you have to do to become for a company with sales over $1 well as public transparency,” Munger a B Corp. Is that true of banks in billion. Companies who have been said. “It also shows that you are a general, and will the business payoff certified come from a wide variety credible leader in the movement be the same for them? of categories – everything from of business as a force for good. Veteran banking analyst Peter bakeries and brewing companies to And with 80% of global consumers Ostrowski, managing director at manufacturers and cosmetics firms. New Jersey-based Ostrowski & Company, doesn’t think so. “That’s not what’s going to drive customers “80% OF GLOBAL CONSUMERS AGREE THAT to your bank, no,” Ostrowski said. BUSINESS MUST PLAY A ROLE IN ADDRESSING “Low rates will, lending policies will, but I don’t see this driving people to SOCIETAL ISSUES, B CORP CERTIFICATION one bank over another. It’s possible PROVIDES THE FRAMEWORK FOR BUSINESSES in some cases but it would be a TO DO JUST THAT.” limited audience in my view.” –Hannah Munger Media spokesperson for B Lab Among the steps Brattleboro S&L took to get the certification were a new minimum wage of $15, plus an agreeing that business must play a Yates said the costs of going adjustment of the pay for everyone role in addressing societal issues, through the process for Brattleboro who’d been making under $18 B Corp Certification provides the S&L were often less tangible. per hour, as well as a new profitframework for businesses to do just “Not in hard dollars, but in soft sharing initiative – although Yates that.” dollars there was time, and a lot of said the decision to raise wages Being a mutual made it easier for it,” Yates said. “We engaged a young was made before the pursuit of the Brattleboro to embrace the priorities man here in town to really help us certification. necessary for B Corp certification through the process, and a lot with The moves increased raw wages at because it didn’t have to deal with data gathering. It took us about six Brattleboro by 5 percent, in addition shareholders who would question months.” to increased costs for employment any short-term hit on the bottom Now that the certification is in taxes and 401k matches. All told, 12 line. hand, Yates says it’s still too early to percent of bank staff saw an increase. “You won’t see a lot of this quantify any business benefits for the The bank also committed five other than in the mutuals,” said bank. His affirmation to this point is years ago to become completely Ostrowski. “One of the things (B what he hears from people, including solar-powered, which counts toward Corp certification) requires is that social media comments and word-ofcertification points. you have other priorities that will mouth that says customers are happy But not everything Brattleboro take precedent over and above the with the bank’s values. put in its application was worth shareholders, and that’s not going “There’s an impact if you bank as much as expected. The bank expected to get points for supporting here,” said Joe Little, senior vice to fly.” ■

May/June 2019 | BANKING NEW ENGLAND 15


Eastern Bank Honored By LGBTQ Community Locally, Nationally


astern Bank, America’s oldest and largest mutual bank, has announced that its support of the LGBTQ community has received national and local recognition by three organizations: • For the sixth consecutive year, Eastern Bank has received a perfect score of 100 on the 2019 Corporate Equality Index, the nation’s premier benchmarking survey and report on corporate policies and practices related to LGBTQ workplace equality, administered by the Human Rights Campaign Foundation. Eastern joins over 560 major U.S. businesses that also earned top marks this year; • For its longstanding commitment to Greater Boston’s LGBT community, the Boston Business Journal has recognized Eastern with its Business of Pride Corporate Ally Award; and • For his commitment to advocating on behalf of the LGBTQ community, Eastern Chair and CEO Bob Rivers has been recognized by Greater Boston PFLAG with its Inspired Ally Award. Advocating for and defending LGBTQ rights has long been important to Eastern.

16 BANKING NEW ENGLAND | May/June 2019


UNITES Examples include in 2018, Eastern contributed hundreds of thousands of dollars to community partners serving the LGBTQ community. In addition, Eastern was instrumental in raising awareness in support of the successful 2018 “Yes on 3” campaign when Massachusetts voters upheld the protections of civil rights for people who are Transgender. Nearly a decade ago, Eastern expanded its health insurance to include coverage for gender-related care, including transition-related surgery and supporting services. Eastern has also created genderneutral bathrooms in its largest facility, in Lynn, Massachusetts, and its “Equality Under the Blue” Employee Network has a visible presence internally and at events

across New England every year. Eastern’s advocacy has expanded from its efforts as the first company to sign GLAD’s amicus brief against DOMA (Defense of Marriage Act) nearly a decade ago. Other efforts include testifying many times since in support of legislative protections in Massachusetts and New Hampshire, to continuing work in economic inclusion on the board of the recently-launched Massachusetts LGBT Chamber of Commerce and offering support for America Competes and HRC’s Business Coalition for the Equality Act. Eastern remains committed to volunteerism and advocacy for the LGBTQ community, in addition to continued philanthropy. ■



Bellwether Community Credit Union Announces Saller as Incoming CEO

Bellwether Community Credit Union’s Board of Directors has appointed Nathan Saller as the successor to current President/CEO, Michael L’Ecuyer. Saller has been named President/COO and will transition to CEO when long-time leader L’Ecuyer retires Oct. 1 from the Manchester, N.H. institution. Saller joined Bellwether in 1997 in a marketing role, then led the company’s retail banking and call center teams and later was placed in charge of corporate strategy. He was named chief operating officer in January 2017 and executive vice president in May 2018. Saller has overseen tremendous growth in the organization. Over the course of his 20-year tenure, he has been influential in growing Bellwether’s membership from 10,000 to over 36,000 members. “It was really important for us to find the right candidate, one who was committed to the values of the organization, and who at the same time possessed the industry knowledge necessary to create an incredible experience for our employees and members,” said John Gennetti, chairman of Bellwether’s Board of Directors. “We were thrilled that we were able to choose a strong internal candidate whose experience and desire to do what’s right for all constituents makes him the perfect person to take the helm.” Saller currently serves as vice chairman for the Greater Manchester Chamber of Commerce, as a member of the Board of Advisors for StayWorkPlayNH, and chairs the marketing committee for America’s Credit Union Museum in Manchester. He received his MBA from UNH Manchester and has a Bachelor of Business Administration from Evangel University. He is also a graduate of the American Bankers’ Association Stonier Graduate School of Banking at the Wharton School of Business/University of Pennsylvania and of Leadership Greater Manchester.

Worcester Credit Union CEO Karen Duffy Announces Retirement

The long-time CEO of the $81 Million Worcester Credit Union has announced her retirement. Karen Duffy has served the membership of Worcester Credit Union for over 25 years and also served on the Cooperative Credit Union Association board for 20 years. During her tenure on the association board, Karen served as chair of the board and

as chair of the legislative affairs committee. “We are very thankful for Karen’s hard work and loyalty to Worcester Credit Union over the past 25 years. She will be missed by the board, staff and members. However, the impact that she has made will live on at the credit union now and into the future,” said Board Chairman Robert J. Hennigan, Jr. Duffy’s retirement will be effective Aug. 31, 2019. The board has retained O’Rourke and Associates to lead the search for the new CEO.

Boston Private Appoints Colleen Graham General Counsel

Boston Private, a provider of wealth management, trust, and commercial and private banking services, announced the appointment of Colleen Graham as executive vice president and general counsel. Graham will have oversight of several key control functions including legal and compliance, and administrative oversight of internal audit. She will report directly to Boston Private CEO Anthony DeChellis. Prior to NextGen Compliance LLC, Graham was the founder and co-CEO of Signac, a fintech joint venture between Credit Suisse and Palantir Technologies, where she led the development of software to detect and mitigate employee and compliance risk for financial services. Earlier in her career, Graham worked at Credit Suisse, serving as managing director and head of compliance americas among other executive management roles in private banking and global markets. Graham earned a J.D. from St. John’s University School of Law where she was a St. Thomas More Full Tuition Scholarship recipient, and holds a B.S. in finance and marketing from Boston College Carroll School of Management.

Deering Joins Bangor Savings Bank Mortgage Team

Kaleigh Deering recently was hired by Bangor Savings Bank as a vice president and mortgage loan officer at the bank’s Scarborough branch. Prior to joining Bangor Savings Bank, Deering served for more than 14 years in a variety of roles in the financial industry, most recently as a vice president and mortgage loan officer at Norway Savings Bank. Deering May/June 2019 | BANKING NEW ENGLAND 17

is a graduate of the University of Southern Maine where she received a bachelor’s degree in Political Science. Deering is active in her community, serving on the Board of Directors for the Maine Association of Mortgage Professionals. She is also an affiliate of the Greater Portland Board of Realtors. In her free time, she enjoys running, skiing, and cooking with her family. Deering resides in Scarborough with her husband and three young boys.

Reilly Elected Board Chair Of The Provident Bank

Bristol County Savings Promotes Silva to EVP & Chief Lending Officer

Bristol County Savings Bank, headquartered in Taunton, Massachusetts, promoted John Silva to executive vice president & chief lending officer. In this new capacity, he will manage the commercial lending, residential lending, consumer lending and indirect lending departments at the Bank. Prior to his promotion, Silva held the positions of executive vice president/commercial lending and senior vice president/commercial lending at the bank. Previously, Silva served in a number of capacities at Santander and its predecessor banks for more than 25 years, including senior vice president, New England regional director in its business banking department. Silva is active in the community as a board member for Blackstone Valley Prep Mayoral Academy where he also serves on the finance committee. In addition, he is a Board Member for the Fall River Office of Economic Development, Greater Fall River Development Corp, Northern Rhode Island Chamber of Commerce, Rhode Island Bankers Association and the South Eastern

Joe Reilly, co-founder of the former Centrix Bank and most recently regional president of Eastern Bank after Eastern’s acquisition of Centrix, has been elected chair of the board of Amesbury, Mass.-based The Provident Bank and its parent, Provident Bancorp. Reilly, who co-founded Centrix in 1999 and served as CEO until 2014, when it was acquired by Eastern, grew the Bedford-based bank to over $1 billion in assets before the sale. He retired from Eastern in December 2017. Reilly said he joined the Provident board “because I had been watching the bank transform and grow over the years from a small community bank to an innovative commercial bank with an outstanding reputation in the banking community.” Before Centrix, Reilly was chief operating officer and senior lending officer at Centerpoint Bank, another startup. After Centerpoint was acquired, Reilly became senior vice president of commercial banking with Bank of New Hampshire. He also worked in various roles at Fleet Bank for 12 years. Provident CEO Dave Mansfield said, that the election of Reilly was unanimous. “He is truly an asset to The Provident and we share a deep respect for everything he has accomplished throughout his 40-year banking career.” Drive Revenue Although it is based in Control Costs Massachusetts, where it has three branches, Provident Improve Performance has five branches in New Hampshire.

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Economic Development Corporation (SEED). He earned his Master of Business Administration degree at the University of Rhode Island, Kingston, Rhode Island, and his bachelor’s degree in business administration from Roger Williams University, Bristol, Rhode Island. Silva resides in Bristol with his wife and children.

Brookline Bank Names Miller as Senior Vice President Commercial Banking

Mark D. Miller has joined Brookline Bank as senior vice president in the bank’s commercial banking division. Miller brings over 35 years of corporate banking experience to Brookline Bank. He previously held senior commercial banking and private banking roles at national and regional banks in Boston and around Massachusetts. Miller will be based in Brookline Bank’s Waltham, Massachusetts office. In previous positions, Miller managed and grew multimillion-dollar portfolios with exceptional credit quality.  He has also coached and mentored junior bankers to help advance their skills in business development, risk management and relationship management. Miller, a resident of Wellesley, Massachusetts, received his B.A. in Economics from Bates College and Masters in Accountancy at Bentley University. He is active in the Greater Boston community and has been involved with numerous organizations including The Association for Corporate Growth, having served as treasurer and executive board member at the MetroWest YMCA, and having been elected for two terms as a town meeting member in Wellesley.

BankNewport Announces Director Of Retail Sales

BankNewport announced that Amy E. Riccitelli, of Smithfield, Rhode Island, had been appointed senior vice president, director of retail sales. She will be responsible for the development and implementation of the bank’s retail banking division. With over 20 years of experience in the financial services industry, Riccitelli joins BankNewport from Citizens Bank where she served as senior vice president, director of instore channel development and partnerships in Providence. Riccitelli earned a Bachelor of Arts in Business Management from Villanova University, and holds a Master of Arts in Business Administration from Providence College.

Berkshire Appoints Three New Board Members

Berkshire Hills Bancorp, Inc., the financial holding company for Berkshire Bank, has announced the appointment of three new members to the Board of Directors: Baye Adofo-Wilson, Esq. has over 20 years of experience in law and business development, with a focus on community development, including the position of deputy mayor/director, economic and housing development for the City of Newark, New Jersey. Currently, Adofo-Wilson is of counsel at Rainon, Coughlin & Minchello focusing on redevelopment law and specializing in New Jersey’s urban transitioning communities and municipalities, while also serving as CEO of BAW Development, LLC, a national real estate development company concentrating on redevelopment and consulting services in diverse communities. Rheo A. Brouillard has more than 40 years of experience in the financial services industry, holding key roles at multiple financial services institutions. Brouillard most recently served as director, president and CEO of SI Financial Group, Inc. Berkshire recently acquired SI Financial, together with its Willimantic CT based subsidiary, Savings Institute Bank & Trust. William H. Hughes III has over 30 years of business experience with expertise in strategy development and execution, technology services and cybersecurity. Hughes is the founder and president of Open4 Learning, an advisory business that is focused on innovation and growth in the education technology and employment technology sectors. A Boston-area resident, he is also the founding manager of CyberHabits LLC, which is a learning-centered cybersecurity solutions company. Messrs. Adofo-Wilson, Brouillard and Hughes were also appointed to the board of directors of Berkshire Bank. ■

EMPLOYMENT Portfolio Manager

Rockland Trust Company (Rockland, MA): Manage loan portfolios & analyze credit for clients in comm & ind. Min reqs: Bachelor’s in bus admin, finance, econ, or rel + 2 yrs exp w/ credit analysis or portfolio mgmt. Must have any dmnstrted wrkng knwldge of: trend analysis of financial posture & repayment capacity; legality of loan covenants; fndmntal princips of finan acc; & sftwre for financial/stat analysis. Send cover letter & resume to with ref to code DA19. May/June 2019 | BANKING NEW ENGLAND 19

SCHEDULE AT-A-GLANCE June 28, 2019 8:30 a.m. Registration Open Networking Breakfast 9:00 a.m. – 9:45 a.m. Best Practices From Consumers Best Banks 9:45 a.m. – 10:30 a.m. You Can Keep Wasting Money…Or Double The Impact Of Your Marketing Spend 10:45 a.m. – 11:30 a.m. Driving Success in a Challenging Retail Banking Environment 11:30 a.m. – 12:30 p.m. Building a Best Bank, From the Ground Up 12:30 p.m. – 1:30 p.m. Networking Luncheon & Banking Choice Awards 1:30 p.m. – 2:30 p.m. Planning for Action

8:30 a.m. Registration Open Networking Breakfast 9:00 a.m. – 9:45 a.m. BEST PRACTICES FROM CONSUMERS’ BEST BANKS If you want to keep and grow your customer base, you need to be keenly attuned to what they actually want from your institution. Using double-blind surveys of tens of thousands of consumers throughout New England, Customer Experience Solutions produces a comprehensive Banking Benchmarks report quarterly. These reports give deep insight into which banks consumers’ like, which ones they’re looking to leave, and why. We’ve put together a panel of bankers whose institutions consistently rank at the top in independent consumer surveys.

Stephen Lewis

Mark Bodin

Monica Curhan

Bruce Paul

Panelists include Stephen Lewis, president of Thomaston Savings Bank and chairman of the Connecticut Bankers Association; Todd Tallman, president and treasurer of Cornerstone Bank in Massachusetts; Mark Bodin, president of New Hampshire’s Savings Bank of Walpole; and Monica Curhan, Chief Marketing Officer, Florence Bank in Western Mass. CES President Bruce Paul will moderate. 9:45 a.m. – 10:30 a.m. YOU CAN KEEP WASTING MONEY … OR DOUBLE THE IMPACT OF YOUR MARKETING SPEND Too many credit unions and community banks are wasting money every day on advertising, marketing, social media, and even employee training because they don’t know what makes them special. Why should a potential new customer trust you? What makes you so special? For many organizations, this question has no answer … yet.

2:30 p.m. Closing Cocktail Networking Reception Glenn C. Van Deusen

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Todd Tallman

In this powerful talk, world-class brand strategist Glenn C. Van Deusen reveals how a strong brand compels your target audience to make you their first choice. His message has the power to awaken your bank or credit union’s full brand potential and multiply the impact of your marketing spending. You will learn how to leverage strengths your organization already possesses to create a brand story that rationally and emotionally connects with your audience.

Don’t miss the Banking Choice Awards NETWORKING AND LUNCHEON 12:30 p.m. – 1:30 p.m. 10:45 a.m. – 11:30 a.m. DRIVING SUCCESS IN A CHALLENGING RETAIL BANKING ENVIRONMENT A decade of historically low interest rates, vanishing fee income, aggressive competitors, and stubborn legacy costs have diminished the profitability of the retail business line. Demographic changes have created a new generation of consumers and small business owners that question the very relevancy of a bank. Still, for many banks, the retail franchise remains one of the most valuable parts of the institution. However, growth in retail banking today typically lags growth in other business lines. Transformational strategies that respond to changing profit dynamics, consumer preferences, and competitive pressures are now needed to revitalize and grow the business. In this session, Mary Ellen Georgas-Tellefsen, managing director of Washington, DCbased Capital Performance Group will review the current state of retail banking and the challenges that threaten long-term success in this business. We will consider how successful retail banks are now shifting to focus on those segments, products, Mary Ellen and markets where growth and profit Georgas-Tellefsen opportunities exist – and retooling their businesses to compete more effectively. 11:30 a.m. – 12:30 p.m. BUILDING A BEST BANK, FROM THE GROUND UP One way to build a best bank is from the bottom up. De novo banks, after a lengthy period of dormancy, are returning to New England with three currently in the process and more in the J. Jeffrey Sullivan G. Frank Teas incubator stage. We’ve put together a panel of de novo bankers that currently includes J. Jeffrey Sullivan, president and CEO of New Valley Bank in Springfield, Mass., and G. Frank Teas, president and CEO of Millyard Bank in Organization in Nashua, New Hampshire. They’ll discuss why is the best time for de novo banks, as well as the hurdles to overcome with capitalization, regulation, and hiring, and the other issues to tackle for forming the best de novo banks. 12:30 p.m. – 1:30 p.m. NETWORKING LUNCHEON & BANKING CHOICE AWARDS Join us as we celebrate New England banking institutions who have been chosen by consumers as the leaders in their industry.

1:30 p.m. – 2:30 p.m. PLANNING FOR ACTION: COMMUNITY BANK M&A PREPAREDNESS Whether your current strategy is to be a buyer or seller, it is critical that you are prepared for all scenarios. This discussion focuses on best practices for pre-deal preparation to position your company for a successful outcome. Gain an advantage by being thoroughly prepared to demonstrate to the other party why your deal makes strategic and financial sense. Kim Snyder is president of KBS Results, a consulting firm that partners with financial institutions to effectively analyze their business to ensure they are being proactive in shaping their future. They assist in the development of essential planning tools, analyze business for Kim Snyder earnings enhancement opportunities and develop human resources strategies that result in the proper alignment of employee and shareholder interests. Prior to starting KBS Results in September 2015, Kim served as executive vice president and CFO of Valley Financial Corporation / Valley Bank, a $900 million publicly traded bank in Roanoke, Virginia, where she was instrumental in the success of the bank which led to the acquisition by BNC Bancorp at a 173% premium to tangible book value. Kim served as the chair of the Virginia Bankers Association CFO Committee from 2012 – 2015. Kim earned the banking graduate degree and leadership certificate from the ABA Stonier Graduate School of Banking and served as the student advisor to the ABA Stonier Graduate School of Banking Board of Directors in 2014. She graduated magna cum laude from James Madison University, is a licensed Certified Public Accountant in the state of Virginia, and a CGMA Designation Holder. 2:30 p.m. CLOSING COCKTAIL NETWORKING RECEPTION Produced by:

Registration Available at

May/June 2019 | BANKING NEW ENGLAND 21


Fed Says New England’s Doing ‘Amazingly Well’


BUT TIGHT LABOR MARKETS POSE CHALLENGE By Jay Lindsay, writer and editor, Federal Reserve Bank of Boston

he New England economy is doing “amazingly well” by several measures, including sustained low unemployment, rising compensation, and steady prices, according to a regional economic update by Boston Fed economist Jeffrey P. Thompson. Thompson, director of the Boston Fed’s New England Public Policy Center, said in May remarks, there are some worrisome economic and demographic trends, including tight labor markets making hiring increasingly difficult and the aging region’s dependence on immigration for population growth. “A shrinking population is a fairly troubling thing to be staring in the face, and without immigration, that’s exactly the picture we’re looking at,” Thompson said. Thompson said the regional economy is “at a Goldilocks moment, not too hot, and not too cold.” The good news includes rising compensation among private industry workers in New England that has outpaced

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national gains, even as growth in prices has remained flat, he said. Meanwhile, the regional job market recovered more quickly than the rest of the nation, as unemployment dropped below pre-recession levels back in 2015. But Thompson added that the tight labor market is making it tougher for employers to find workers. The region’s gross domestic product rate grew at 3.17 percent in 2018 compared with 2.9 percent for the United States. Connecticut’s GDP rate was 3.36 percent. However, unlike the rest of New England, Connecticut’s GDP shrunk by .2 percent in 2017 while New England’s GDP increased 1.6 percent. The regional GDP is forecasted to grow by 2.65 percent in 2019, drop to .82 percent in 2020 and then rebound to 2.2 percent in 2021. New England’s population has also grown older than the rest of the country. In 1950, the median age in the six states was in line with the median age nationwide, but since 2010, the median age in every New England state

has exceeded the U.S. median age. Also, New England’s population growth rate has been flat or negative since about 2012, if international immigration is excluded. Thompson said the issue is of particular relevance in New England’s northern tier of Maine, New Hampshire and Vermont, which is considerably older and aging faster than the rest of the region. In a presentation after Thompson’s, Middlebury College professor Peter Nelson presented data indicating deaths are outnumbering births through much of the northern tier. His data also indicated the region’s smallest towns – communities of 1,000 people or less that are prevalent throughout northern New England – are struggling to keep people. While larger communities have seen modest but slowing gains since the 1990s, those towns have seen their populations fall. Thompson said a declining population raises numerous concerns. For instance, it can exacerbate worker shortages caused by the tight labor market. It also compromises the region’s ability to sustain housing prices and its publicly funded institutions, he said. During his presentation, Thompson also pointed to state’s susceptibility to fiscal distress in the case of a recession. Connecticut, Massachusetts and Vermont faced elevated risks, according to research by S&P Global Market Intelligence in a report entitled, “When the Credit Cycle Turns, U.S. States May be Tested in Unprecedented Ways.” Rhode Island and Maine face elevated risks, while New Hampshire is best positioned as one of 14 states in the country that is predicted to have a low risk from a recession. Long-term challenges New England faces, Thompson

said in his presentation, include infrastructure; housing affordability; population growth and demographic shifts; and, cost of higher education. New England Public Policy Center senior economist Bo Zhao shared results from his recent research report, “Consequences of State Disinvestment in Higher Education: Lessons for the New England States.” During his talk, Zhao focused on the impacts of state funding cuts to higher education, including the fact that fewer people earn degrees. He also noted that state spending reductions have the most impact on degree completion at community colleges. Zhao’s research estimated that for every $10 million cut in state funding for community colleges, 57 fewer associate’s degrees were awarded. Zhao estimated that community colleges in New England collectively granted 21,388 fewer associate’s degrees during the 2002–2012 period than they would have granted if they had received per-student state appropriations at the 2001 level in each year after the 2001 recession. With regards to infrastructure and its impact on the regional economy, Thompson presented figures showing five New England states are among the 10 “worst” for Infrastructure. Four of the states (Rhode Island, New Hampshire, Maine and Connecticut) have more than half of their roads in poor or mediocre condition. Five states (the four listed plus Massachusetts) have predicted 20year water infrastructure costs ranging from $1.3 billion to $12.2 billion in Massachusetts. ■ (Jay Lindsay is a writer for the Federal Reserve Bank of Boston. This article was originally published to

May/June 2019 | BANKING NEW ENGLAND 23


Banking New England publishes a weekly digital newsletter that rounds up the latest news and information about, you guessed it, banking in New England. Here are a few stories from recent editions. If you would like to subscribe to, share your news, or advertise in the Banking New England newsletter, contact us at

PEOPLE’S EYES MORE SUPERMARKETS AFTER MERGER Connecticut-based People’s United Bank recently acquired Belmont Savings Bank, ultimately putting more local government bank accounts in the hands of the company. Though, the bank doesn’t intend on stopping there. It also gave the bank something it did not yet have in Greater Boston: supermarket branches. Of the six Belmont Savings branches it acquired, three — in Waltham, Cambridge and Newton — are located inside Star Market stores. The business of supermarket branches is something People’s United knows well, in other markets. It’s one that it would like to explore more in the Bay State, according to Pat Sullivan, the bank’s Massachusetts president. “We like supermarket branching. This gives us an opportunity to look at our distribution system and say, Are we better off to go to a Shaw’s now? Is our customer better off to go to a Shaw’s versus building a traditional branch?” Sullivan said in an interview. Star and Shaw’s are both owned by the Idaho-based supermarket giant Albertsons. 24 BANKING NEW ENGLAND | May/June 2019

People’s United has just under 150 supermarket branches in Connecticut and New York, all in Stop & Shop stores. (Citizens Bank has exclusive rights to operate bank branches in Stop & Shops in Massachusetts.) People’s has expanded in Stop & Shop stores in those states as it has closed traditional branches, Sullivan said. BERKSHIRE COMPLETES SI FINANCIAL ACQUISITION Berkshire Hills Bancorp, Inc. has completed the acquisition of SI Financial Group, Inc. and the merger of Savings Institute and Trust Company into Berkshire Bank as of the end of business this past Friday. Berkshire issued approximately 5.7 million common shares as merger consideration in the stock for stock exchange detailed in the merger agreement. The total stock consideration is valued at approximately $176 million. Including the new shares issued, Berkshire’s outstanding common stock has increased to approximately 51.2 million shares, resulting in a market capitalization of approximately $1.6 billion. With this acquisition, Berkshire adds

18 branches in Eastern Connecticut and five branches in Rhode Island. The merger adds approximately $1.7 billion in assets and $1.3 billion in low cost deposits. SI Financial shareholders will receive 0.48 shares of Berkshire common stock for each share of SI Financial common stock. The exchange ratio is fixed and the transaction is expected to qualify as a tax-free exchange for shareholders of SI Financial. SI Financial Group, Inc. is the holding company for Savings Institute Bank and Trust Company. Established in 1842, Savings Institute Bank and Trust Company was headquartered in Willimantic, Connecticut. VERMONT GOVERNOR SIGNS BANKING LEGISLATION Vermont Gov. Phil Scott has signed legislation intended to simplify doing business in Vermont for fintech companies and other non-depository licenses and will reduce compliance costs for the state’s Department of Financial Regulation and the industry. Vermont Biz reports Scott said at a bill signing, “My administration has been laser focused on helping to build a 21st century economy in Vermont and an important

piece of that is modernizing our laws and regulations. I appreciate the department’s efforts, and the support of the Legislature, to build on Vermont’s leadership in financial services.” The bill makes the following revisions and updates among others: • Changes the three-year exam cycle for loan solicitation companies to a risk-based exam cycle. • Updates the administrative penalty provisions to make them consistent for all licensees. • Excludes from the money services license requirement: (1) agents of payees; (2) payment processors; and (3) independent trust companies. • Authorizes the department to provide advisory opinions, nonobjection letters, and no action letter and charge a reasonable fee, and, • Prohibits a lead solicitation company from using the name of a financial institution without the financial institution’s consent and gives the department, the financial institution, and the Attorney General the ability to pursue violations. GALLAGHER NAMED MASSACHUSETTS BANKING COMMISSIONER Mary Gallagher will be the third woman to hold the position of Massachusetts banking commissioner. Consumer Affairs and Business Regulation Undersecretary Edward Palleschi promoted Mary Gallagher to commissioner of the Division of Banks and also named Cynthia Begin to serve as first deputy commissioner. Gallagher worked for 17 years in the financial services sector and has served as chief operating officer at the Division of Banks since 2015. A Harvard University graduate with a degree in psychology, her private sector experience has included jobs in Boston, New York and London. She had worked in foreign exchange and equity market sales and trading roles at Morgan Stanley, State Street Global Markets, and Deutsche Bank Alex. Brown. Gallagher is the first woman to serve as banking commissioner in 40 years and the third woman to hold the job. According to an administration official, Freyda Koplow served as

banking commissioner from 1967 to 1975 and was immediately succeeded by Carol Greenwald, who served until 1979. SANDERS BACK POSTAL BANKING VT Senator Bernie Sanders and New York Democrat Rep. Alexandria Ocasio-Cortez are standing behind a proposal for postal banking, allowing post offices to provide financial services. In legislation unveiled in April, which also aims to cap credit card interest rates at 15 percent, the pair of selfidentified Democratic Socialists said postal banking could provide relief to low-income Americans. “Post offices exist in almost every community in our country,” Sanders wrote in a blog post. “There are more than 31,000 retail post offices in this country. An important way to provide decent banking opportunities for low-income communities is to allow the U.S. Postal Service to engage in basic banking services.” Some of the proposed services a postal banking system could offer include low-interest loans, checking and savings accounts, debit cards, check cashing, bill payment, ATM services, online banking services and electronic money transfers. The measure was framed as a way to prevent lower-income Americans from falling victim to predatory payday lending practices – and from having to rely on Wall Street’s largest institutions.

Savings Bank. JPMorgan Chase & Co. ranked behind only Bangor Savings, Eastern, Rockland Trust and TD Bank. Chase opened its first retail branches in Massachusetts in the past few months, with dozens more to come. In New England, it also has a retail presence in Connecticut. The survey delivered good news for Boston-based Santander Bank: Its score in the study was higher than the New England region average. Santander rated higher than six of the 11 New England banks, including slightly higher than Citizens Bank, Webster Bank and People’s United Bank. It’s a turnaround from its performance in the survey for most of this decade. At one point, Santander ranked last in the New England survey for five consecutive years.

WEBSTER BANK BUYS MORTGAGE PORTFOLIO TO BOOST BOSTON PRESENCE Webster Financial Corp., parent company of Webster Bank, has purchased a $242 million residential mortgage portfolio. The move was undertaken to bolster the company’s relationship with hundreds of wealthy Greater Boston residents. Webster bought the loans with a goal of using them to develop relationships with “the 500 highquality customers in and around the Boston area” whose mortgages make up the portfolio, Webster Chief Financial Officer Glenn MacInnes said during an earnings call this week. BANK OF AMERICA RANKS The bank did not divulge from LOWEST FOR CUSTOMER whom it bought the portfolio. It also SATISFACTION did not release the terms of the Among a banker’s dozen in New transaction, though executives said it England, Bank of America scrapes was acquired at a discount. Returns the bottom in customer satisfaction, will exceed the cost of capital, with according to a recent J.D. Power the portfolio growing Webster’s survey. That’s in sharp contrast to net interest income on the year, previous years when B of A ranked according to MacInnes. above average. The Boston Business Journal reports Executives said that Webster had not been actively looking to buy a Bank of America was the only one of residential mortgage portfolio. “When 12 banks in the survey with a belowthis opportunity came about and in average rating in retail customer the market it came about, it was an satisfaction in New England. The effective way, on an economically survey takes into account products profitable basis, to acquire customers and fees, convenience, and problem in Boston, where we’re making a lot resolution, among other factors. of good progress,” Ciulla, the Webster The highest-rated of the 12 banks in New England was Maine’s Bangor CEO, said during the earnings call. ■ May/June 2019 | BANKING NEW ENGLAND 25


5 Big Ideas For Bank Marketing VIDEO, GEN Z, AND EMOTIONS ARE THE KEYS TO SUCCESS By Keith Griffin im Perry, a senior strategist with Market Insights, Inc., told a packed room at the New England Financial Marketing Association’s spring meeting, that New England has challenging demographics in terms of behavior, but there are strategies to shake up the status quo. Banks, he said, aren’t so much competing for deposits and loans as they are fighting for time and attention. Media consumption is happening in a digital space. “Within 5 minutes of waking up, 65 percent of people look at their phones,” Perry said. Digital is where consumers are located. “Ninety-five percent of media consumption is in the digital space, but we’re switching screens 20 times an hour. Google says goldfish have longer attention spans than humans do,” Perry said at the conference held in downtown Providence. Interpreting the data correctly from the digital habits of consumers will be important going forward, Lee said. Unlike traditional media that cuts across a broad swath of consumers, digital marketing needs to be more precise. “You can’t sell HELOCs to someone who needs an auto loan,” Lee said. Banking data, he added, can’t be kept in a separate silo from marketing tools. Increase Video and Voice Perry said the demand for video and voice search is escalating. “Voice search and voiceactivated control are ramping up exponentially,” he counseled, adding as of 2020, it is expected 1 million minutes of video will be added every second on the internet. “If the last video your bank did was the ice bucket challenge, it’s time to update.” The trend, though, is six-second videos. You can get your image out there in a quick storyline on places like Facebook, Twitter, and Instagram.

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However, that doesn’t mean long-form video is dead. Consumers are willing to watch well-done 3 to 5-minute videos if they are entertaining and informative. One practical tip, Perry put forth, is the use of vertical videos. On some social media platforms, vertical videos work better than the more traditional horizontal videos. Why’s video so crucial as a marketing tool? “We retain 95 percent of the information we see on video. With text we might hold 10 percent,” Perry said. “Our brains are adjusting to a visual world.” Banks should consider creating a library of ondemand webinars, as well as live-streaming events to reach mass audiences. “Don’t give people a PDF. Give them a video. It creates a stickier presence,” Perry said. “Bank marketers have to think more like media companies and match up what customers are listening to when crafting videos.” Voice activated apps are also another tool marketers need to consider. Perry cited research showing a 39.8 percent growth year over year in smart speaker installed base units like Alexa. As of January 2019, 66.4 million adults in the U.S. owned one. Get Ready for Generation Z “Don’t repeat the mistakes with Generation Z you made with millennials,” Perry said. Generation Z encompasses the generation born from 1997 to current day, according to the Pew Research Center. As Perry observed, Gen Z is fiscally conservative in part because its members came of age during the last recession. They have attitudes similar to their great grandparents who lived during the Great Depression. “They save out of fear,” Perry said. Other statistics worth noting about Gen Z, Perry said, include one-fourth of them had smartphones by age 10; 7 out of 10 have savings; and half have a money app on their phones like Current,

Greenlight or MoneyLion. This is a generation that is also opposed to paying fees, but they are willing to pay for access. said they don’t like to pay fees for overdrafts but are willing to pay for protection against being overdrawn.

Google says goldfish have longer attention spans than humans do

Be More Emotional Emotional marketing works well for connecting with consumers. Perry said, “Empathy expressed through both physical and digital channels leads to greater emotional engagement.” Citing a study of 60,000 consumers, Perry said emotionally connected banking customers are six times more valuable to financial institutions. Lifetime revenue, on average, increases from $10,189 for highly satisfied customers to $59,500 for emotionally connected customers. Perry said marketers need to ensure their communications to consumers have some emotion to be effective. Emotional marketing makes people curious, encourages them to share the story, and is more likely to be shared with others. The empathy, though, can’t just be in the marketing materials. “You need to get empathy expressed by all employees – even the call center. All employees need to be skilled in active listening and not just listening for upsell opportunities,” he said. Marketing Should Be Helpful Assistance is the new battleground for growth, Perry posited. “As expectations of the tech-empowered consumer continue to rise, the most assistive brands will win,” he said. Perry pointed to research showing nearly 80 percent of retail bank customers wants advice; only 28 percent say they get it. Perry said HarborOne Bank’s “Harbor U” is a prime example of what banks should do. The program, according to HarborOne, was one of the country’s first centers devoted to financial education, life stage programs, and small business assistance. He also cited Cape Cod 5’s partnership with the Seed Corporation to host free business workshops as another example. Another means banks have for being helpful to small businesses is converting branch space into shared working quarters. “That creates a physical space in a way that supports local entrepreneurs,” Perry said. Build An Anti-Fragile Brand Perry, in his presentation, also said brand science changes as consumer behaviors change. Financial institutions need to be highly adaptive, authentic, and flexible. An essential element of that, he added, is banks need to be willing to accept that mistakes will happen but still be invested in keeping the customer. “You’re in it for the long term,” he said. ■

May/June 2019 | BANKING NEW ENGLAND 27


randed talks with Gregg Rosen, president & principal of NES Group, and Chris Gill, senior director at Diebold Nixdorf, about the latest trends in ATMs and how they are affecting the efforts of financial institutions to keep and attract new customers.

question for details about what consumers are demanding from their ATMs.] BNE: What are some of the latest innovations you have seen in ATMs being installed at credit unions and banks across New England? Gregg: The self-services capabilities available on today’s ATMs offer consumers an engaging, relevant and personalized experience. The ATM channel is being enhanced for several different reasons: • Omni-channel banking increases customer convenience and provides more options to perform banking transactions • Increase operational efficiency by enabling a wider selection of transactions via self-service • Reposition the branch as more of a center for providing financial advice and meeting complex needs

Gregg Rosen

Chris Gill

Banking New England: What’s been done with ATMs and other technology to address the simple fact that customers are coming to branches in lower numbers? Answer: Banks and credit unions are realizing that because consumers spent so much time online, they must deliver self-service that is integrated with consumers’ devices and it must be highly personalized. This is critical if they want to maintain their brand identity and ensure their future success. With Artificial Intelligence learning more about each consumer daily, this important data can be used through your ATM to better serve the consumer in real time. Many financial institutions have recognized the ATM as a primary touchpoint and the “face” of their brand and have developed a comprehensive digital strategy. This involves optimizing cash automation, cash recycling and enabling the latest technological innovations to create a seamless user experience.

For example, some consumers today are bypassing the ATM because they prefer notes other than $20 bills, which is what most banks and credit unions are dispensing today at their ATMs. With the advanced software now available on an ATM, a consumer can not only receive other denominations, such as $10 or $50 bills, but can also select their preferred bill mix. So, for example, a consumer could now get $50 at the ATM consisting of three $10 bills and one $20 bill. Larger institutions in New England are already providing this capability or will be introducing it soon. One feature that has been deployed broadly by larger institutions – envelope-less deposits – is now being implemented by community banks and credit unions in New England. This feature enables a consumer to make a check or cash deposit directly into the ATM without an envelope. Enabling ATM deposits in this fashion has significantly increased consumer adoption since the ATM provides an image of the deposited check on the receipt or an itemization of cash deposited.

BNE: As research by Diebold Nixdorf shows, slightly more than half of consumers consider access to branches and ATMs to be important when selecting a financial institution. Once they get there, how much are consumers demanding from their ATMs?

Another innovation that has been deployed in the New England area is pre-staging of ATM transactions on the mobile app, which eliminates the need for an ATM card to make a withdrawal. On the mobile app, the customer selects an ATM and the amount they want to withdraw. When they go to that ATM, they scan their phone and input a one-time PIN in order to retrieve their cash. This transaction enhances customer convenience by enabling a withdrawal without a card.

A: Customers expect a seamless experience at the ATM that is tailored to their needs. The ATM should be able to transcend transactional experiences and build relationships between a financial institution and its customers and also be highly secure. [See the next

Some institutions in the region have introduced videoenabled ATMs to their customers. These units enable a customer to interact with a centrally located call center agent who can perform teller transactions on the ATM that otherwise would not be available. For example, a

28 BANKING NEW ENGLAND | May/June 2019



consumer could deposit a check and get more cash back than would be possible if they did the deposit on an ATM. Institutions offering these video ATMs also make them available for longer hours than a typical branch, which increases customer convenience. Lastly, some institutions have offered the ability to set personal preferences at the ATM, such as fast cash amount, language and receipts. In today’s world of e-commerce, this makes the ATM more similar to websites that personalize a user’s experience. BNE: Are ATMs the new branch offices? Are financial institutions using them to replace the more elaborate branches people know? A: It’s true that ATM technology has improved to the point where many consumers can now complete tasks that they otherwise would have required teller services for. From our point of view, the bank branch of the future will shift from being predominantly transactional to offering highly consultative services. This is why we feel we should design for the branch of today while planning for the future. It’s our view that as digital and physical solutions in-branch continue to evolve and improve, tasks that previously constituted the day-to-day will become automated. This, in turn, will allow branches and employees to focus on giving consumers highly personalized experiences and engage with customers more strategically. BNE: What’s behind the lasting appeal of ATMs? After all, we’re not officially a cashless society but we’re getting there. Also, it’s easy enough to get cash back with most purchases too. A: There’s been a great deal of industry conversation about whether our society will ever truly be “cashless.” But the fact remains, cash is not going away any time soon. The majority of transactions especially for smaller purchases are still being paid for with cash. Studies show that cash in circulation in the U.S. is growing at the same rate as GDP.

experience across all channels and think critically about their mobile and desktop apps and capabilities - it’s a competitive necessity. We’re seeing that consumers are willing to switch banks based on UX alone, which means it has a significant influence on revenue. Diebold Nixdorf is laser-focused on differentiation in a digital world - which is why we work with our partners to uniquely improve their digital ecosystems. With 60 percent of the global banking population using online banking at least weekly and mobile banking on the rise as well, optimized and efficient digital systems also play a large role in reducing friction, thereby optimizing the quality of face-to-face interactions in-branch. BNE: How are the new ATMs and technology improving branch efficiency? What are some examples? A: ATMs allow branches to operate more efficiently and enhance the consumer experience because they offer expanded hours and enhanced capabilities. What could only traditionally be conducted with a teller can now be done at an ATM, allowing transactions to be processed more efficiently. For example, at most institutions, deposits of checks and cash account for a significant percentage of transactions at the teller line (typically 40-50 percent of all transactions). By enhancing the deposit-taking functionality of the ATM (by eliminating the envelope), institutions can migrate a significant percentage of transactions to self-service. Some institutions now have 50 percent or more of deposits being conducted either at the ATM or on the mobile app. This enables banks and credit unions to either redeploy their teller staff to higher-value activities where they can develop and expand customer relationships, or otherwise reduce operating costs. This is a critical channel for banks and credit unions making it important to ensure optimal uptime of the ATMs. Branch efficiency can be improved by utilizing more sophisticated service, reporting and monitoring of their network.

The ATM itself remains a critical channel for financial institutions to provide consumers with the array of services, convenience and choice they demand. ATMs can be found nearly everywhere and are an extremely convenient way to receive cash or conduct other banking transactions since they are usually available 24 hours a day, 7 days a week.

Another innovation that can increase operational efficiency is cash recycling, whereby cash deposited in the ATM can be re-dispensed to another customer. This technology is common elsewhere in the world (i.e., Asia, Europe) and is now being considered by larger banks in the U.S. as a way to offer their customers multiple denominations while at the same time reducing the cash replenishment costs.

BNE: Looking beyond ATMs, what technology is keeping consumers coming back to banks and not switching?

With all of this new technology and functions that ATM’s are capable of offering, combined with knowledgeable Universal Agents, branches have become smaller, needing less space and less staff. Bottom line, ROI can be reached faster. ■

A: Financial institutions must prioritize their user

May/June 2019 | BANKING NEW ENGLAND 29


Bob Montgomery-Rice, President and CEO Bangor Savings Bank Bangor, Maine

“The best advice I give is to volunteer for every opportunity that comes along to keep yourself on your toes.” By KEITH GRIFFIN

A political science major with a minor in history from UMass at Amherst, Bob Montgomery-Rice has been at Bangor Savings for 15 years after a career in both human resources and retail. Banking New England caught up with him for a chat about his life outside banking hours.

FAVORITE SPORT: As a kid growing up in Worcester, I played football, basketball and baseball. I was also a swimmer. And, as an adult, I transitioned into coaching (soccer and basketball). As a native New Englander, I’m a big fan of all the Boston teams: Red Sox, Patriots and the Celtics. But I’m not much of a hockey fan. I struggle with the rules. MUSIC: I’m a fan of all music, especially anything from the ‘80s. My first concert was The Who at The Centrum in Worcester. That was 1982‐ish. It was one of their farewell tours. I’ve been to some more since. Last concert was either Imagine Dragons or Foreigner last summer. My most favorite concert has to be Sting on the waterfront here in Bangor. There is a train track that runs next to the venue and, as it happened, a train went by that evening as he was playing. He totally rolled with it. Very cool. MOVIES: I watch The Shawshank Redemption and National Treasurer every time I come across them. I’m a big fan of The Mummy series with Brendan Fraser. Both my kids make fun of me for that. I’d always prefer to watch a movie at home – somewhere I can be comfortable. Unless it’s Star Wars or Harry Potter. Those have to be watched in a theater on the big screen.

BOOKS: I have at any given time 10 or 12 books I am reading. It’s a struggle to finish books because I’m so busy. I’m a history buff, so a good non‐fiction is my go‐to. My favorite book of all time was David McCullough’s biography about John Adams. It was fascinating. I also read a lot of business focused books. I’m always looking for wisdom and tidbits I can share with my team. Currently, we are all reading Culture Code by Dan Coyle. It has some great insight and tips about how to cultivate a positive and purposeful corporate culture. WHAT TOPS YOUR BUCKET LIST? Visiting Egypt and the Great Pyramids is at the top of my list. Seeing all Seven Wonders of the world would also be incredible. My wife doesn’t share that. If I ever have a month to live, we’re going to Egypt. FAVORITE PLACE TO VISIT: My wife and I love to travel. We just returned from Charleston, S.C., and will be headed to Europe this summer. We have a Viking cruise planned on the Rhine. It’s that history thing. We visited Italy a few years ago. And we try to get to the Caribbean at least once a year. We love St. Martin. There’s something about the crystal‐blue water and white sand. CUISINE: I can cook. I’m OK, but I’m not great at it. I do make soups. My favorite all time are pumpkin and asparagus. I’m awesome at making reservations and going out to eat. I like anything farm to table or small plate. I’m willing to experiment. We’re fortunate in Maine that we have Portland. There are probably 100 good restaurants. SOMETHING MY CO-WORKERS DON’T KNOW ABOUT ME: I was once an encyclopedia salesman. In college, for about a month. It was awful! I still remember… on my last day, I visited a house where the husband and wife had a huge fight in front of me. I left, walked back to the convenience store where my ride was scheduled to pick me up at the end of the day, and just waited. There was no way I was knocking on another door. ■

30 BANKING NEW ENGLAND | May/June 2019

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