Bank Profile | By Linda Goodspeed
Across the industry, banks are seeing branch traffic slowing – by some estimates, as much as 40 percent in certain places – leading many institutions to rethink their brick-and-mortar strategy in favor of a more digitized delivery system.
But rather than shrink its physical footprint, Pioneer Bank in Troy, is, well … pioneering … a new model.
“We want to be thought of as pioneers, not in the Davy Crockett sense, but in the trailblazer sense,” said Thomas L. Amell, president and CEO.
And trailblazers they are. Pioneer Bank is in the midst of revamping its entire branch network, all 18 locations, into one-stop centers where customers can not only do their banking, but process photos, ship packages, shop for locally made gifts and other merchandise, have a cup of coffee and enjoy free Wi-Fi. The new branch design also has meeting rooms that local nonprofits can use. In the Pioneer model, bank branches have become community centers.
“We want to give people a reason to put their car in park and come inside,” Amell said.
So far, the model seems to be working. At its four remodeled branch locations, traffic is up.
“Granted, it’s slight,” Amell said. “But the downward trend has flattened.”
Founded in 1889, Pioneer, an independent mutual bank, today has total assets of about $780 million, and 18 branches located in and around the Capital Region. It is the only mutual bank left in the area. The Albany region is a highly competitive banking environment with a strong, diversified economy and good-paying jobs, thanks to a growing nanotechnology industry, state government, higher education and health care.
“We are fortunate that we were a bit isolated from the last downturn,” Amell said.
Amell arrived at Pioneer in 2012, and has been on a nonstop mission to revamp and grow the bank ever since. The bank rebranded itself, dropping its former tagline, “Where Banking is Personal.” The bank no longer has a slogan, but rather a promise that underscores all of its marketing: it provides “banking for dreamers, doers, movers and shakers” for the customers it calls “New Pioneers.” Next came the new branch concept. Pioneer opened its first new revamped branch in April 2013 in Clifton Park.
“When some of our customers first came in they almost did a double-take, it was so different,” said Jesse Tomczak, chief customer experience officer.
Instead of traditional teller lines, Pioneer is instituting pods at many of its locations and adopting a universal customer service model where employees are trained to provide any service a customer requests, from taking a deposit, to shipping a package, to opening a home equity line of credit. Even its ATMs are more personalized; branches now feature interactive teller machines that allow customers to interact face-to-face with a call center (“customer experience center”) employee. Branches also include “The Shops of Pioneer,” where customers can purchase stationery, mugs, candles, seasonal items and an array of other gifts and merchandise, with proceeds donated to local charities and nonprofits.
So far, Pioneer has revamped four of its branch locations, with another three planned for later in 2016, as well as a brand new, 60,000-square-foot headquarters.
The new headquarters, located on one of the most visible corners in the region (Wolf Road and Albany Shaker Road in Colonie) should be ready for occupancy in July.
“We are absolutely committed to bricks and mortar,” Tomczak said. “We are a mutual bank and have been part of the community since 1889. We have a responsibility to be there for our customers in the communities where they live and work.”
Amell said the new branch concept is a risk, but doing nothing and simply accepting lower traffic patterns was more of a risk. For the transactional relationship – cashing a check, making a deposit, checking balances – he said the digital model works. But when it comes to financial advice, discussing a child’s college future, buying a home, Amell says customers want a face-to-face relationship.
Amell said all 18 branches should be upgraded within the next three years. The bank is also growing its wealth management division, exploring the insurance market and hopes to top the $1 billion mark within that same time line.
Pioneer is already the fifth largest commercial lender in the area, and its loan portfolio reflects that, with a 70-30 commercial/residential balance – a mix Amell likes. The bank is also one of the most stable, earning a five-star rating from Bauer Financial Inc. each quarter for more than 25 years, an accomplishment that fewer than 5 percent of banks in the country can claim.
In addition to its branches, Pioneer is also investing in its 240 employees. During the downturn, Amell said many industries, not just banking, cut back on employee training. Pioneer is reversing that trend with its “Imagine U” (for University), a robust curriculum for employees at all levels.
“We want to attract and retain the very best people,” he said, “and training is essential to that.”■