From Good to Great
By Michael M. Quick
I consider it an honor to have been elected as the 2006-2007 chairman of NJBankers. When I was asked to be on the board of trustees several years ago, I never dreamed that the appointment would lead to the position of chairman. Observing the leadership of our immediate past chairmen Jim Hyman and Ted Bessler during my past two years in the chairs, I am aware of the time and effort that is needed to be an effective chairman and I have prepared my schedule accordingly. I, like my predecessors, have every intention to meet the goal of providing value to the members of our association, but before I get into the specifics of the plan to bring our organization from “good to great,” I wish to thank several individuals for their part in this venture.
First, I wish to thank Bill Reuter, chairman, president and CEO of Susquehanna Bancshares Inc. for encouraging my participation in NJBankers. As a past chairman of the Maryland Bankers Association, he fully understands the commitment a bankers association has to its state and the positive impact it generates, and for this reason he has encouraged all of our company’s corporate officers to be active within their state bankers’ organizations.
Second, I can’t express enough how much I appreciate having a strong executive team with which to work. No chairman can go it alone and expect to succeed. The team consists of Vice Chairman Roger Bosma, president and CEO of Lakeland Bancorp Inc.; Treasurer Norman E. Beatty, chairman of the board, president and CEO of First Hope Bank; and Secretary Gerald H. Lipkin, chairman, president and CEO of Valley National Bank.
As we strive toward transforming NJBankers from a good organization into a great one, it will take more than just the executive committee, the board and the association staff to accomplish our objectives. We will also be relying on the commitment and involvement of our members to help us carry forward our plans.
LOOKING TO OUR PAST
Immediately prior to being elected chairman, I asked our President Stu Cameron to provide me with information on the past leaders of the association, a list of the mergers that affected our membership and the number of new banks since the early 1990s.
Years of being a leader have taught me that you can learn the successes and the challenges of any organization by studying its history. One can also learn more about its future by understanding where its position is within its life cycle. I was intrigued by the high caliber of bankers who have led our organization through the years from one of our governors, Ed Stokes, to some who in fact influenced my own banking career, including Horace Moeller, “Gus” Costalas, Robert Van Buren and Harry Van Sciver. Not only did they apply their unique personalities and skills to developing the banking industry in New Jersey, they also left a positive mark on shaping the success of NJBankers on both the state and national levels.
As I further reviewed the information, it became more apparent that significant changes to the fabric of the New Jersey banking industry landscape have taken place since 1992. During that period there have been 156 acquisitions where the original charter of the acquirer has been dissolved. New Jersey financial institutions made 107 of those acquisitions. During the same period there were no new bank charters opened until January 15, 1997. Between that date and April 2006, there have been over 60 new bank charter applications filed, of which most opened.
These changes have had an impact on our association as we have seen our membership shift from 136 in the late 1980s to the current 65, with many banks less than 15 years old. It should also be noted that, according to FDIC reports, this is reflective of the national trend which shows that the number of community banks have been cut nearly in half since 1989.
The association, faced with the realities of the changing landscape, regardless of the reason(s), must make the adjustments necessary to dramatically enhance its role to be played within the financial community on both the state and national levels. It is apparent that all of its members want the association to be the pre-eminent choice of financial service providers for a trade association.
The officers of the association, including the president, are working collectively on the process that will achieve our goal of enhancing the membership’s investment in NJBankers. The collective thoughts, following many months of discussion, are centered on three points that we believe will move the association from being a good organization toward being a great association. We are in concurrence that the time is now to move forward with our enhanced vision.
A NEW STRATEGIC PLAN
The last strategic plan was completed almost four years ago. As I stated, our association is different than when this plan was completed. It is the belief of the officers that a new plan should be developed. With the board’s approval, we will be seeking the assistance of an objective third-party strategic planning consultant to help us with this process.
• Organization structure – Among other things, we plan to examine the structure of the association and see how we compare with other state bankers associations that have similar attributes. We will also assess our staff and committee needs to be sure they are adequate for achieving our vision and goals. It is also our intent to encourage the involvement of future bank leaders within the revitalized structure.
• Revenue generation – Another objective is to assess our fiscal condition and seek new ways to generate non-dues income to fund our organization so we can become less reliant on dues. As part of the process we will see how the percentage of dues in our annual budget compares against other state bankers associations’ budget-dues ratios. We will also seek to identify more meaningful ways we can use to penetrate members’ usage of service corporation products and services along with expanding member usage of our educational programs.
• Attracting old and new members – In addition to recognizing that attrition by way of merger and consolidation makes membership that much more essential to every bank’s benefit, the added value of being a member as a result of executing the new vision and bringing about added value is aimed at attracting new members and the reinstatement of former members.
• Strategic partnering with other state bankers associations – We will explore the possibilities of expanding partnering with other state bankers associations for joint educational purposes and even joint purchasing of goods and services as an added member benefit.
When member strategic planning surveys are conducted over the next few months, we ask that you please complete them. The closer we come to 100 percent member participation, the closer we will come to preparing a more meaningful and appropriate strategic plan. Once our consultant is in place, we will establish a timeline for the plan’s completion and adoption.
CREATING VALUE FOR THE MEMBERSHIP
We must overcome the misperception that some members have about the organization in terms of the value the association provides in both Trenton and Washington. There was a time when I had similar misperceptions, but that has changed since I have become more familiar with what the association does for the New Jersey banking industry. Last year, for example, when the IOLTA issue was front and center, there were some who doubted if the association could do much about it. Not only did NJBankers do something about the problem, but the association’s efforts, along with assistance from Dennis DiLazzero, saved New Jersey financial institutions an estimated interest expense of $21 million.
The association has also stepped up its Washington presence and is working more closely with the ABA than it has in recent times. At our recent Washington visit (see coverage page 28) we heard Sen. Menendez say that the voice of NJBankers through its president is now being heard. We are expanding our ABC meetings to the federal legislators. In fact, through NJBankers, Congressman Scott Garrett has scheduled a meeting of bankers in his district to hear our concerns. He is a member of the House Financial Services Committee.
TAKING ON A NATIONAL PERSPECTIVE
The association is also weighing in on the credit union issue. This spring, nearly 2,500 NJBankers joined the national effort and signed petitions against HR-2317, the Credit Union Regulatory Improvements Act. Each member of the New Jersey Congressional delegation received a set of petitions. We are aiming to bring more of the national banking issues forward in our publications to garner more member awareness and support for ABA initiatives on the Hill.
This will also mean more transferring funds to Bank Pac through JebPac. Last year we provided a meager $8,000. This year we are aiming to make our $42,000 federal goal, while still having sufficient funds to meet our in-state efforts. ABA returns the dollars by letting us determine which members of the New Jersey delegation should be supported and provides us the funds for direct distribution so that both associations receive acknowledgement for the contributions. NJBankers is also represented on a number of ABA committees including: Government Relations, Bank Pac, Community Bankers and Membership. We have also stepped up our participation at numerous ABA conferences throughout the year.
In fact, last year, then-Chairman Bessler, President Cameron and I attended the ABA Summer Meeting. It was during that time when we learned what other state bankers associations were doing to raise funds. Some of the ideas shared included grant-writing to reduce the association’s cost for continuing education, and creating multi-state contracts with service providers such as check companies, medical insurance, flood insurance and office supplies. As a buying consortium, the associations receive a stipend while members gain a discount benefit.
We are already in the process of reaching out to other state associations in the region to explore that possibility and we are about to sign an endorsement contract with one of our affiliates to provide flood insurance determinations. To make these ideas work we will be relying on member direction and participation. We want to direct our energies on those products and services identified by members that will bring the greatest benefit and utilization.
VISIBILITY AMONG OUR MEMBERSHIP
In the fall of 2002 we started reaching out to members through establishing CEO Roundtables to better understand member concerns. We have the state divided into regional groups and have held 11 such meetings in the past three years. The input received has led to such innovations as the development of our Web site, AIB/e-Banking online training and the implementation of our FinCrime anti-fraud program.
We are currently putting in place a new informational e-Bulletin to be released on Fridays which we expect to be in place in the fall. This was an outgrowth of a suggestion made at a recent CEO Roundtable. These meetings, as schedules allow, will continue in the fall.
Throughout the summer months we will continue individualized CEO visits with association leadership to gain more input and to insure alignment between the association’s strategic plans and our members. Thirty such visits have occurred over the past two years.
For the past 103 years, each preceding chairman has fulfilled the promise of making the association better and building upon the successes of his or her predecessor. I, along with our newly elected officers and board, am dedicated to continue in that honorable tradition.
Our industry in New Jersey needs one strong voice to be its advocate in Trenton and Washington. We continue to be a target of additional regulation, a source of satisfying lack of sufficient revenues at all levels of government, a deep-pocket conduit aimed at solving societal ills amidst a lack of understanding of our profit structure. Since 1989 there has evolved the need for the banking industry to become more united than ever before to fight these issues that have diluted the return for our stockholders. The leaders in this fight have been the state and national bankers associations.
It is our collective belief that the preferred voice for the New Jersey banking industry is the New Jersey Bankers Association. The challenge facing our organization is to create an atmosphere that clearly demonstrates that NJBankers is the viable alternative to represent the industry’s interests. We hope that all bankers throughout New Jersey will accept our vision and join us in the process of making NJBankers the majority voice for the banking industry within our state as we move forward from being a “good” organization into becoming a “great” one!
Michael M. Quick is chairman and chief executive officer of Susquehanna Patriot Bank, Marlton, and executive vice president and group executive of affiliate banks of Susquehanna Bancshares Inc.