‘I’m concerned about people thinking the money under their mattresses is safe’

Sunday, May 10, 2009 at 11:19pm
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Suzanne Reed says FirstBank is investing in its online presence and trying to recruit younger clients.  Jude Ferrara/The City Paper

Suzanne Reed joined Lexington, Tenn.-based FirstBank in 2001 as marketing director. Now as senior vice president and a member of FirstBank’s executive management team, Reed leads sales and marketing efforts for FirstBank’s more than 40 locations across Tennessee. Her responsibilities include traditional marketing as well as retail sales management, treasury management sales, and fee-based initiatives such as community bank products and credit card portfolios. She also helps oversee the bank’s downtown Nashville office.

During her more than 17 years in the financial services sector, Reed has held roles at Bankers Bank (now Deutsche Bank), American General and, most recently, with AmSouth Bank, where she served as marketing director. Reed and City Paper news correspondent William Williams recently discussed community banking.

What nationwide banking trends are positively and/or negatively impacting Nashville?

Positively, online banking and mobile banking options and features continue to grow. The Pew Research Center just released a new analysis called “Generations Online in 2009” that explains how the various generations are interacting online.

We have ramped up our outreach to Generations X and Y. In doing so, we have launched a new version of our Web site, and we actively promote our FirstRewards checking account, which is based on banking online.

As we continue to grow, we are building branches with what we call a modern, dialogue-banking atmosphere that is friendly and focused more on relationships. Our new branches include a café, media center, children’s area and computers for customers to do online banking within the branch. We want to make sure we are giving people the personalized service and advice they want and need.

What’s happened on Wall Street and to the larger institutions has made individuals question the security of their money in FDIC-insured banks. When you hear the phrase “bank bailout” in the news, it’s not referring to community banks such as FirstBank. However, there are several different plans sponsored by the government to ensure all banks are continuing to grow and succeed.

How have the current national economic conditions affected community banking differently than they have major regional and national banking entities?

Last year, when big Wall Street investment banks were failing and other commercial banks were struggling to make a profit, community banks like FirstBank were lumped in with everyone else, even though FirstBank was profitable.

The ratings and rankings include only part of the story. FirstBank, like many other community banks, didn’t have the same investments as the Wall Street Banks. But because of what’s happened across the nation, everything has become intertwined.

During this time, FirstBank has taken the opportunity to connect with customers. We have spent a lot of time making them comfortable with our banking model and the opportunities they have at FirstBank. In addition to talking with customers, we have grown our households by more than 1,500, which to me is a testimony to the strength of our bank.

How difficult is it to capture market share in Nashville given that FirstBank isn’t headquartered here?

From my perspective, our headquarters location doesn’t make a difference. Our core leadership team is made up of veteran bankers who have lived in Middle Tennessee and have strong relationships in the Nashville business community. In addition to their connections, and our pseudo headquarters in downtown Nashville, we have branches in Williamson, Wilson and Sumner counties. We have many associates who call Middle Tennessee home.

However, regardless of headquarters location or the geographic location of the leadership, FirstBank encourages its team members to know their markets and customers. We realize that relationship focus is crucial to helping our customers succeed financially. We are focused on being a different kind of community bank, and we’re in the process of redefining what that means for us and our customers.

One of your focus areas is sales and marketing. Along these lines, any new initiatives for the next five years?

Everyone is struggling with the same issue — how we can scale back and tighten our spending while maintaining a strong banking environment for our clients. At FirstBank, this includes expanding our online presence, dabbling in social media and continuing to look for opportunities to network with Generations X and Y. For example, we recently launched a FirstBank fan page on Facebook to better connect us to those generations as well as respond to questions and concerns about banking.

We also took a radical step in 2008 by hiring Micheal Burt as FirstBank’s life coach. We brought him in to help associates grow professionally and to infect the associates with the FirstBank customer experience.

FirstBank’s ratio of non-performing loans to total equity capital at the end of last year was about 21.8 percent, well above the national average of 11.2 percent. What perspective can you share about that figure?

In the summer of 2008, we chose to take a proactive approach by looking at the loans we knew could have some issues. We increased our loan loss provision then because we preferred to face it head-on rather than deal with it later. It is a high number, but it was a conscious decision made by management to protect our long-term success.

How has FirstBank’s model been effective?

Our model was successful in West Tennessee, so we want to take advantage of economic growth in areas like Davidson, Williamson, Sumner, Rutherford and Wilson counties, which are some of the fastest-growing counties, not just in the state, but in the nation. We see great opportunities in these areas to take a piece of the retail banking market share, and we’re being creative in our approach.

For example, in November, we launched a “Coin Bandit” program with Vanderbilt Children’s Hospital to strengthen our commitment to the region. We are looking into more partnerships like this one.

What is the most distinctive characteristic of community banking?

For us, our associates have the opportunity to make the majority of our decisions locally because there is only one shareholder and sole owner, Jim Ayers. Because of his entrepreneurial spirit and advocacy for Tennessee, he established FirstBank as a bank based on attitude and commitment — not size or assets.

What concerns you most regarding the current banking climate — your competition or consumers’ banking behavior?

With the recent failures of the Wall Street banks and instability of some financial institutions, what alarms me more than any of our competition is individuals who question their financial relationships and have lost trust in our banking system. I’m concerned about those individuals who are taking their FDIC-insured money out of accounts and putting it under their mattresses thinking their money is safe. Nothing is further than the truth. That’s what keeps me up at night.