Community bankers are coming to terms with the management successionproblem and looking for ways to attract young talent.
What's the problem?
During a panel at CommerceStreet Capital LLC's April 28 community banking conference in Dallas,Commerce Street managing director Brian Johnson said that small banks have to talkabout the "management succession issue," and bridge the "talent gap"between younger bankers and older executives. The challenge for the industry alsolies in the perception of banking, Johnson said. For younger jobseekers, banks'involvement in the financial crisis "left a bad taste in their mouth,"he added.
Robert Strong, panelist and executive vice president of commercialbanking at Mutual of Omaha Bankin Dallas, Texas, said that talent exiting the industry and inadequate traininghave played into the "top-heavy age demographic" in banking.
"Competing employers are attracting talented young peoplefor other reasons aside from compensation and an 8-5 job," he added. Strongsaid that young, prospective employees look at the banking industry from a differentperspective. The group is not entirely motivated by salaries because they placehigh value on their time outside of the office, he said.
Lee Training & Consulting Co. consultant Doyle Lee pointedout that banks need to understand and embrace the tech-savvy demographic."Why would you not want these young people on your boards, as part of yourstaff?" he said.
Here's a solution
Kent Belasco, former chief information officer at Itasca, Ill.-basedFirst Midwest Bancorp Inc.,is the director of a new banking program being developed at Marquette University.Belasco said the program is meant to drive interest in careers in banking and makesuse of a network of community banks in Wisconsin and Illinois.
"What we're trying to do in the program is fill a gap,"Belasco said. "Once they complete our program, they will already have had twointernships with banks and they should be able to hit the ground running and goright into a bank."
He said that community banks struggle to attract top talent partlybecause larger banks offer "more robust" salary and benefit packages.Still, Belasco said that community bankers have a real opportunity to appeal toyounger generations. Because they function much like small businesses, the valueproposition offered by small banks is the opportunity to "learn banking completely,"he said.
"When you work in a smaller community bank, you tend tolearn all aspects of banking, leading towards senior levels of management or possiblyeven CEO," Belasco added.
Belasco will connect students with his banking network in hopesthat graduates will secure a full-time position at a small institution in the region.He said that the program, slated to begin in early 2017, is a "win-win"for bankers and students. Belasco also said that he is developing an advisory groupof bankers who can recruit from the program and offer feedback as he develops curriculum.
Robert Cera, co-CEOof Green Bay, Wis.-based Nicolet BanksharesInc., is on the advisory board for Marquette's new banking program.In an interview, he said that people between the ages of about 25 to 45 came upduring a time when larger banks discontinued the management training programs thatexisted before.
"You're relying now on individual banks or individuals themselvesto foster their own development programs and foster their own careers," Cerasaid. "It's just not as easy."
For recent graduates, career opportunities on Wall Street mightseem more exciting than community banking jobs which are often further away fromthe larger cities that appeal to young people, he added.
"If kids are exposed to the term 'banking,' they're thinkingabout it in the context of something bigger and grander than community banking,"Cera said.
As a member of Belasco's advisory board, he hopes that the programat Marquette will "expose college-aged kids to the industry again" andplant seeds of interest.
"One of the other things is that technology is playing suchan important role in banking," he said. "We want to ensure that kids areinterested in banking but understand just how important technology is to the industryso kids that have a predisposition toward anything in IT or technology-related isalso helpful."