Our roots go back to 1889, when we were called the Bank of Sturgeon Bay. We became Baylake Bank in the 1980s; we’ve built nine branches in Green Bay and we have a significant presence here. People like the cache that Baylake represents in Door County and they are curious to see what it means in Green Bay. People like to hear that story.
We are one of the largest banks that is domiciled and headquartered in Wisconsin. People like the significance that we’ve been around for a long time; that stability really resonates with them. Our management team is predominantly from Northeastern Wisconsin.
I’m from Milwaukee, and one of the exciting things about coming to Green Bay and Baylake was my ability to reconnect with UW-Green Bay, my alma mater. I was an accounting major and a soccer player. I graduated in 1984 and it’s been an important connection point for me to get involved in the university as an alum.
While I think you will see a slowdown of banks expanding, in our case, we’re looking to grow our footprint. We have a long-term strategy that revolves around building our brand, predominantly going south from here. It makes the most sense to look down the I-43 corridor, partly because we feel like there’s just slightly less competition in that corridor. Our water motif, in terms of our brand, fits well as we go down the lakeshore.
I certainly am optimistic that today the economy is stabilizing but not to the extent that I believe a recovery is going to be noticeable to most consumers and small businesses. I still think we’re six to 12 months out in terms of the beginning signs of a real recovery and I still think 2010 will be a challenging year.
Our loan portfolio has suffered the effects of a challenging economy but it also suffered the effects of credit and lending decisions that over a longer, sustainable period of time were not consistent in every way, shape and form. Most of our problem loans over the last two and a half years related to the commercial real estate sector. With the economy not growing, it is a very difficult time to attract new tenants when they don’t have a reason to move into more space or bigger space or more attractive space.
In the early part of 2009 as we worked through some of those problems, we began to make our operations more efficient. We’ve had a slight attrition in our employment force but it’s been really more as a result of people leaving the company and us deciding not to replace those positions.
Over the last two quarters we’ve begun a turnaround. We’ve installed better policies and procedures, better oversight from a management perspective and we’ve made some management changes that will lead to a better managed bank that hopefully will produce better results in the future.
A bank, as a fiduciary, lends out other people’s money. You are reminded of that every day as a banker and you remind yourself that you have to make good decisions because all that money that’s in the bank, predominantly, is not yours. The credit environment right now is such that banks, if they are very forthright, will say they are making more prudent decisions, they’re more conservative in this environment and hence credit is probably more difficult to obtain – that’s the honest truth.
Businesses that are utilizing credit for growing their business are having less of a difficult time obtaining credit. But those businesses that are struggling or suffering operating losses are certainly going to be challenged to finance their businesses in this environment.
The best thing a bank can do in every situation is be forthright in their decision making and just be honest. Not every situation allows you to say yes to a loan request and those situations it’s important to give people an answer and give people an answer that’s timely – and let them know why.