People’s Utah Bancorp and Lewiston Bancorp merger closes
People’s Utah Bancorp and Lewiston Bancorp have merged their holding companies—the first bank merger in Utah since before the 2008 recession. The merger closed today, October 18, following approval by regulatory agencies, shareholders of Lewiston and both boards of directors.
“The People’s Utah Bancorp and Lewiston Bancorp merger is the first unassisted merger in Utah since Far West Bank was acquired by American West Bancorp in 2007,” said Tom Bay, supervisor of banks, Utah Department of Financial Institutions. “Smaller banks are seeing their burden increase. They feel like they survived the downturn just to be hit in the gut with what they feel is an increasing regulatory environment. Mergers can be a way of using economies of scale to help with the increased fixed costs of doing business. Utah is not like California or other states with many banks and a lot of merger activity going on, so it’s harder to see a trend here, but I would not be surprised to see more mergers in Utah going forward.”
“The purpose of this merger is to ensure that both banks are able to continue the highly personal service that each has provided for a hundred years or more in an economic and regulatory environment that makes it hard for community banks to compete,” said Richard Beard, president and CEO of People’s Utah Bancorp. “We wanted to figure out a way to help community banks come together and preserve what is good about the system. This merger combines years of community banking commitment and experience under one roof.”
In June, the companies jointly announced an agreement to merge their holding companies and operate their bank subsidiaries, Bank of American Fork and Lewiston State Bank, under People’s Utah Bancorp. The merger was dependent on various regulatory approvals and a shareholder vote in favor of the transaction. All of those were obtained by October 15. The closing occurred today.
As of September 30, 2013, People’s Utah Bancorp had approximately 320 employees, $1 billion in assets, loans of $643 million, deposits of $900 million and equity of $120 million. Lewiston had approximately 90 employees, $257 million in assets, loans of $180 million, deposits of $223 million and equity of $28 million. The combined holding company now operates under the name People’s Utah Bancorp and has approximately $1.2 billion in assets. Bank of American Fork, with 14 locations in Utah, and Lewiston State Bank, with four locations in Utah and Idaho, will continue to operate under their respective names. Customers of both banks will continue to receive the personal, friendly service from bank staff they have come to know and trust.
“Between our two banks there are more than 200 years of combined banking experience,” Beard said. “The community values and traditions that both banks share makes this partnership work for the organizations, employees, customers and communities we serve. Blending the talented management and staff of both banks helps put People’s Utah Bancorp in a clear position as Utah’s community bank leader in service, asset size and deposit size. This combination will help grow and foster the local community banking system that is vital to the economy, small businesses and Utah communities.”
“I am pleased with the working relationships between the two banks and the enhanced ability both will have to serve our respective customers,” said Anthony J. Hall, president and CEO of Lewiston State Bank and chairman of Utah Bankers Association. “We will maintain our name and local presence going forward. We look forward to the benefits from developing a statewide community banking group. The merger offers many benefits for our shareholders, our employees, and most importantly, our customers.”
People’s Utah was advised in the transaction by D.A. Davidson & Co., as financial advisor. Lewiston was advised by Sandler O’Neill + Partners, L.P., as financial advisor.
Guest post by Richard Gray
With the economy steadily improving, many businesses are looking to grow—buying their buildings, remodeling their spaces, growing inventory, investing in large equipment and more. The first step to obtain financing is to take a look at your business plan and current situation, and take that information to your lender to talk about your options. Preparing answers to the questions they will likely ask will help you stay on top of the game.
Last month I talked about why banks behave the way they do—what kinds of things factor into loan decisions and the process by which loan decisions are made. I mentioned that banks determine whether they will lend based on cash flow, credit, capital and character—the four C’s of commercial lending. Through these measures, businesses can demonstrate a solid ability to repay their loan in a timely manner.
So, what, specifically does each of these C’s mean, and why do they matter?
The viability of your cash flow will be determined by analysis of one or both of the following: your company’s profit and loss statement, with the key figure being earnings before interest, taxes, depreciation and amortization; or its statement of cash flows, with the key figure being cash flow from operating activities. This analysis considers all of your debt obligations and will be used to determine your ability to repay the debt.
This is your ability to fulfill your financial obligations based on your own and your business’ financial history. Lenders will rely heavily on your business credit report that provides information regarding classification (based on size and creditor payment history), outstanding liens and pending lawsuits. In last month’s Enterprise there was an article about the weight of your business credit score. In that article, Lane Wilson said, “Just as a personal credit score helps or hinders a consumer’s ability to obtain credit, businesses also have credit scores that play a key role in securing financing.” If you’re interested in learning how to improve your business credit score, I would recommend reading that article.
Lenders will also consult a personal credit report to evaluate your debt obligations and come to a determination on whether your past indicates that it’s likely that you will make regular, on-time payments in the future. As a safeguard, you may want to pull your report ahead of time to check for errors (you should already be taking advantage of your three free credit reports from Equifax, Experian and TransUnion each year).
Another part of examining credit is a thorough review of your company’s financial statements, usually for the past three years. Financial ratios that look at liquidity, leverage and performance will be calculated from your balance sheets and P&L statements to be compared to industry averages.
Collateral is what you can offer as security for the loan. For small businesses, this may be commercial real estate and improvements (including land, buildings and fixtures) or investments (like stocks and bonds) that can be liquidated in the event of a default. Lenders are typically willing to lend between 50 and 90 percent of the value of the collateral (known as 50 to 90 percent “loan to value”).
In addition to cash flow, credit and collateral, lenders also heavily consider “soft” traits, cumulatively known as character. These include your business background, business acumen, education, work experience and ability to be successful. Lenders learn this information by their personal interactions with you and your general reputation in the community, but also on the payment trends outlined in your credit reports, dependability of your entire management team, previous lawsuits or charges that indicate unethical behavior and background checks.
While the other three Cs carry a lot of weight, don’t underestimate the power that good character and a good relationship with your banker can have in your attainment of a commercial loan. This is when it’s advantageous to bank at a community bank with a local banker who knows you and can make a loan decision at the local level.
When you have your four C’s in line, talk to your lender about what kind of financing is available to you. If your business is strong in these areas, you will likely be able to finance the type of steady growth that helps communities and people to succeed. If one area is weaker than the others, talk to your lender. There may be programs or opportunities still available for your business. As always, your lender will be a great guide in helping you to find the right type of financing for your business.
Richard Gray is senior vice president of commercial lending and SBA lending at Bank of American Fork, Utah’s community bank leader, an Equal Housing Lender and Member FDIC. Richard also manages the bank’s Murray branch, and he has assisted local small businesses in obtaining SBA funding for more than 25 years. He serves on the board of directors for nonprofit Kostopolus Dream Foundation and was the chairman for nonprofit Utah Microenterprise Loan Fund, Salt Lake City.
Every business has a culture; that is, how the people within the organization behave. Their collective behavior reflects the values of the company, its common vision, beliefs, norms, language and systems. For newcomers, they must become part of the culture—or function sub-optimally as they become isolated from others who fit that culture.
Over time, company cultures tend to gain a life of their own; they drift, more or less unguided, to what they are today. And, often, business leaders come to the conclusion that they are dissatisfied with their current culture. The critical question becomes how to make improvements to that culture. The following are five proven steps for improving corporate culture.
STEP ONE: Clearly define the culture you have in terms of both its strengths and weaknesses. While it is easy to recognize that all businesses have a culture, it is often difficult to clearly define the culture of one’s company—and that is a problem. Start with the behaviors you observe and link them to the values of the organization. Be sure that behaviors that are dysfunctional (they don’t fit with the core beliefs of the company) are clearly described and understood.
STEP TWO: Clearly define the culture you want. Define the behaviors you would like to see in terms of those that are positive and should be retained, and those that will replace negative actions.
STEP THREE: Collaborate with your key stakeholders in defining the desired culture. Be sure to discuss the ramifications of the change. How will employees react? Is turnover likely to result? What unintended consequences might surprise us? Be sure to recognize that culture change requires a compelling vision of the new, improved culture and an unbreakable commitment from key stakeholders to implement it. Don’t move to implement such improvements without both of these!
STEP FOUR: Communicate clearly and thoroughly with all employees regarding the specifics of the improved culture. Ask for and answer any questions they have regarding the change. Make sure that thorough communication includes the expected benefits of the change, and the ramifications of individual or collective failure to implement. In other words, make sure everyone knows that compliance is expected!
STEP FIVE: Sustain the new culture. Leaders must “walk their talk” in being the prime examples of the new culture. They should also be highly attuned to recognizing and complimenting the new behaviors as they observe them. In this regard, they also should seek feedback as to the perceived benefits or concerns employees express about those behaviors. Ultimately, appropriate sustaining actions will help lead to full implementation and adoption of the new culture.
Do these steps work? When implemented completely, our experience is that they are virtually 100 percent effective. That said, the most critical step is the fifth one. Leader-driven culture change will not happen if leaders fail to lead—and their sustaining actions often are needed over the long haul. The unguided drift mentioned above typically occurs over a number of years; don’t expect to improve your culture overnight!
Richard Tyson is the founder, principal owner and president of CEObuilder, which provides forums for consulting and coaching to executives in small businesses. For 21 years, CEObuilder has successfully brought about an outstanding financial return for CEO and executive clients through providing leading-edge content in the areas of strategizing, team-building, problem-solving and managing for results, as well as the use of proprietary learning and coaching.
Guest post by Ken Burnett, VP/Director of Training and Business Development, Bank of American Fork
This series is written from experience and is part of Bank of American Fork’s training program. The program embraces the philosophy that training is a skill-based job, and managers need to learn specific skills to be successful.
As a training professional with more than 25 years of experience in the field, I think the statement that still gives me an eye twitch is when a well-meaning manager says, “Sally isn’t able to perform her job, so she needs training.” Sally may need training to improve her skills and knowledge, but usually the lack of performance is a combination of issues, some of which training can’t fix.
For example, about 25 years and 40 pounds ago I wanted to learn how to dunk a basketball. I got the best shoes, had a personal trainer to get me in shape and wanted to dunk a basketball more than anything in my life (not really, but good for the story).
Well, after developing better jumping skills than Superman, I was ready to give it a try. No matter how many times I tried I couldn’t do it. Not because I didn’t want to, but because my fingers are too small. I couldn’t hold the ball. No amount of training would help me–I didn’t have the aptitude. What really should have happened is for me to analyze my performance in relation to the task to determine the performance gap. I would then know the best how to proceed to improve my performance.
Training is too often the only lever managers pull that they think will change performance. It is only one of about eight factors that affect employee performance. To determine if something is a training issue, I use this test. I take out a 10-dollar bill, and say to the associate, “Take all the time you need, use any reference you want and I will pay you $10 if you can perform the task.” If the associate can perform the task, the issue is not a training issue.
If you really want to change performance you need to play the symphony of factors that affect performance. In most cases all of these factors play a role in performance, but need to be blended together the right way. Like a musical symphony, each affecting factor needs to be coordinated and each played at the appropriate time. Each symphony is different, just as each job or task is different. The key is to determine what you expect from the performance and then go through each factor to determine its effect.
The factors that affect performance are:
• Skills and knowledge—Do they know how to use the system?
• Motivation—Does the employee understand the importance of the task and want to meet your expectations?
• Aptitude—Are they capable?
• Coaching and feedback—Is their manager monitoring their performance and reacting to it?
• Measures and metrics—Do they understand the expectations?
• Environment—Are there clear processes and references?
I will address in detail these factors during this series of articles, but all of them are critical. During a training intervention (whether it’s a classroom or self-paced course), at best I can get the employee to perform the task at a novice level. Performance really improves through performing up to clear expectations. The reverse is also true. If I teach a training class on professionalism that outlines clear expectations, and after the class those expectations are never mentioned by the manager, performance will not change, and the training was just a two-hour vacation.
A phrase that makes my heart sink is “refresher training” (an exception is if a task is seasonal). Frequently the term refresher training is a quick fix for another performance-related issue. I first look at the factors listed previously and often I take out that $10.00. Then, work with the department requesting training to address the real performance issues.
In many performance situations, skills and knowledge degrade when they aren’t supported by the other factors that affect performance. This means that training does become part of the solution–a supporting part. Look for one of the upcoming articles in this series to talk about how to choose the correct training intervention, and the difference between training and communication.
Taking a holistic look at performance that includes training in its proper role is a very powerful skill for an organization’s management to learn.
Ken also wrote a series for manager skills. What other business skills do you want to know more about? Tell us in the comments!
Ken Burnett is vice president/director of training and business development for Bank of American Fork. He is responsible for training more than 300 employees on a variety of topics, including coaching and feedback for dozens of senior managers within the organization.
We’re celebrating one hundred years of serving Utah communities with free cookie Fridays. Each month one of our 13 branches will be spotlighted—for that month, the spotlighted branch will have free cookies in their lobby. You can read a little bit about the history of Bank of American Fork below, with a history of the spotlighted branch. For a deeper history and to view photos visit here and select “downloads”.
Bank of American Fork was established in 1913 as The People’s State Bank of American Fork. The first two decades after opening brought success for the bank and its reputation for being safe and sound was solidified. Challenges came in 1932, when the People’s State Bank of American Fork closed its doors to prevent a run on deposits. While a third of the nation’s banks did the same and never reopened, the People’s State Bank was open for business nine months later after tremendous sacrifice on the part of its management. The 1940s and ‘50s were better years for banking, and the People’s State Bank of American Fork thrived. In the 1960s the name was shortened to Bank of American Fork and proved itself a technological leader when it made a large investment in upgrading to advanced computerized systems. In the ‘80s and ‘90s, Bank of American Fork began to receive national recognition for being safe and strong. It was during this time that the bank began strategic expansion across Utah, finding communities where Bank of American Fork fit and filled needs. Today, we are proud to be a part of 13 communities, and Utah’s community bank leader.
Murray Branch January 15, 2003 The bank’s 10th branch opened in Murray. Management had been debating the idea for several years, and moved on a location once they had employees who knew the area and its residents well. When the bank found the right people, including branch manager Richard Gray, and veteran operations manager Kathie Rockwell, the bank’s new branch opened in leased office space near Fashion Place Mall. At the time, it was the bank’s northern-most branch. During this time of expansion, a cross-functional group of employees created a mission statement for the bank to ensure that new employees and managers would provide the communities they served with the customer service people had grown to love about Bank of American Fork. This summer, the Murray branch moved to a new location on State Street, into a space gutted and remodeled to improve customer service. Have you visited?
Don’t forget to stop by the Murray branch on Fridays this month and grab a cookie!
The convenience of a global card, with local service
With the Bank of American Fork VISA® Business Rewards credit card, you’ll have the convenience of a global card, with local service. Most businesses today use a credit card for business expenses. Use this card with a low, fixed rate, a no-fee rewards program and no annual fee. Points for business purchases add up quickly and can be redeemed for brand-name merchandise and travel.
• One reward point for every two dollars spent
• Reward points can be redeemed for merchandise and/or travel
• No specific airline you have to use for reward travel
• No blackout dates on reward travel
• No cap on annual rewards earned
• No fee for rewards
Other perks include free concierge service, up to $1 million automatic travel accident insurance and fraud monitoring.
Our VISA® Business Rewards credit card is also ideal for international travel. You’ll save money with better currency exchange rates and can use the card anywhere in the world VISA® is accepted.
If you are disciplined about paying off the balance in full each month, credit cards can be a good resource. You can make online purchases, you might get cash back or other rewards, credit cards can help you build your credit and they can be life-savers in an emergency. With a credit card, you have until your monthly payment due date before remitting payment, allowing you more time to review your online transactions for suspicious activity—when you use a debit card, funds are immediately deducted from your account.
Talk to your banker, visit www.bankaf.com or call 800-815-BANK to learn more or apply.
VISA® and the name Visa are federally registered Trademarks of Visa.
Guest post by Richard Swart
The Goldman Sachs 10,000 Small Businesses Program at Salt Lake Community College is probably the single most impactful program for small business owners in Utah—and one that most small business owners don’t know about. All banks have an obligation to give back to their communities as part of the Community Reinvestment Act. Goldman Sachs has taken an innovative approach. After spending more than a year doing research on the U.S. economy and small businesses, they realized the best way to jump start the economy is to equip small business owners to grow their businesses.
The Goldman Sachs foundation has committed $500,000,000 (no, that is not a typo) to training 10,000 small business owners in the United States to grow and scale their existing businesses. Utah is one of 11 sites in the United States, and it should not come as a surprise that the first cohort of Utah small business owners to graduate from the program set national records for job creation and revenue growth.
This first class of 33 small business owners completed the program in May of 2013. They have so far hired at least 74 full-time employees—and they have increased their sales by tens of millions of dollars. How does Goldman Sachs 10,000 Small Businesses program pull this off? The program is an intense mentoring and education program, but unlike an MBA program or college class, participants work on their own businesses—studying them and making changes to improve their business. Several businesses are posed for major growth and expansion.
The program is competitive. Small business owners have to apply at slcc10ksb.com and it requires that participants be committed to growing their businesses and be able to step away from running their businesses every Friday for about 20 weeks to work on learning to grow. Instructors come from the community. Instead of college faculty, they are highly regarded experts from Utah with an average of more than 20 years’ experience. You will learn from the best and you will learn what works in this market.
Is there a secret to the success of this program in Utah? One explanation may be that the program has had 44 percent women-owned businesses. Nationally, women-owned businesses represent less than 20 percent of scholars in the Goldman Sachs 10,000 Small Business Program. While there are many reasons why Utah is leading the nation in outcomes, it is clear that these women business owners bring different ideas, experience and a drive to the program that are part of the secret of its success. The dynamics of the cohorts is amazing and these business owners are doing amazing things.
If you have been in business two years, have at least four employees, and revenues of at least $150,000 a year, you should consider applying. Goldman Sachs 10,000 Small Businesses Program is fully supported by the foundation. There is no catch—you don’t owe the program anything but your willingness to work hard and grow your business to improve our economy.
Richard Swart is a leader in Utah’s Entrepreneur Community, founder of the Entrepreneurs Circle, and a recognized world-wide authority in crowd funding. He has taught at Utah State University, the University of Utah and is now directing a research program at University of California, Berkeley. He is a consultant for the Goldman Sachs 10,000 Small Businesses Program in Utah.
CEObuilder and Bank of American Fork invite you to join us on Wednesday, October 16, 2013 for a forum and presentation by Mark H. Hansen, assistant professor of organizational leadership and strategy, department of organizational leadership and strategy, BYU Marriott School. Hansen’s presentation will focus on strategic thinking and leadership. You can also join the conversation on Twitter at #ceobuilder or LinkedIn.
At this forum, we will study the strategic thinking of the Allied Supreme Commander and some of his key generals during the Battle of the Bulge, officially known as the German Ardennes Offensive. We will also briefly examine the strategic thinking of the German High Command.
The Battle of the Bulge is considered to be a decisive turning point in World War II. After the Battle of the Bulge there was little, if any, question as to the ultimate outcome of the war. The Germans had engaged in an absolute, last-hope gamble. In hindsight, it seems easy to see that the gamble was ill-advised. However, if a few things had gone differently, the gamble may have paid off for the Germans.
Our study of these generals at the Battle of the Bulge will focus on the initial reaction of the Allied generals, the formulation of the Allied response, and the execution of that response. General Eisenhower’s decision making and strategy execution will be the main focus of our discussion. His decision making was swift at times and slow and deliberate at others. He seems to have had keen insight into how to balance decisiveness and deliberateness.
Another main point of the day will be Eisenhower’s decision to transfer the command of two armies from General Bradley, a friend of many years, to Field Marshall Montgomery, the British commander. This decision speaks volumes about placing the good of the organization ahead of friendships.
We will watch several video clips from documentaries and the Band of Brothers miniseries. We will then discuss the principles of leadership and strategy evident in these clips. The main learning points from our morning together will include:
1. Recognizing threat and opportunity, sometimes even recognizing the opportunity in the threat
2. Great strategy depends on accurate information
3. Recognizing the time to be deliberate and the time to be decisive
4. The importance of being specific in communicating strategy
5. Managing the interests of the organization and friendships
Please read the entire packet titled The Battle of the Ardennes: Analysis of Strategic Leadership and Decisions (participants who RSVP by October 11 will receive it in the mail). This packet is about 65 pages, double-spaced so it’s not really very long. From the book titled Generals of the Ardennes, please read the following passages: 47-82, 119-136, 182-205, 345-350 (not required, but can be ordered on Amazon).
We will focus primarily on Eisenhower and Bradley. Pages 182-205 are focused on Patton (there are really only about four pages of text here, the rest are pictures). Pay attention to what the authors have to say about Field Marshall Montgomery. You can go to books.google.com and look up The Longest Winter by Alex Kershaw. You can scroll down and read from the bottom of page 172 to 174 about the friction between Montgomery and Eisenhower. This is clearly an American point of view, but it adds an important dimension to Eisenhower’s decision to turn over command of the northern forces to Montgomery.
This forum will be held at Bank of American Fork, Riverton Branch Conference Room, 2691 West 12600 South, from 8:30 a.m. to 4:30 p.m. on Wednesday, October 16. Please RSVP by Monday, October 14 by contacting Heidi at Heidi.email@example.com or 801-642-3139.
We launched a new mobile banking application for iPad, making it easier for customers to bank on the go. Bank of American Fork mobile banking is now available through apps on iPad, iPhone® and Android™, or smartphone and tablet users can visit mobile.bankaf.com on their mobile device.
“We’re excited to be able to extend our mobile banking footprint to accommodate our iPad users,” said Josh Everton, eSolutions manager. “Our online customer base is more mobile than ever and they really like using the mobile handheld device apps, especially to be able to deposit checks. Our tablet users have anxiously awaited the launch or our native iPad offering and we are glad to provide another option to make their banking experience as easy as possible.”
Some of the expanded features unique to the app for the iPad include:
• Online consumer check and savings account applications
• Live customer service chat
• 30 days of transaction history
• 18 months of archived eStatements
• Advanced location and contact tools
Mobile banking with Bank of American Fork is safe and allows customers to bank on-the-go. All of the mobile apps allow customers to do the following:
• Deposit checks†
• Check account balances
• View account history
• Pay bills‡
• Transfer funds
• Find Bank of American Fork branch contact information and locations
To ensure safety, we recommend that customers only download our native mobile apps from the following sources: download our iPhone app or iPad app from the iTunes Store® or App StoreSM and the Android app from the Android Market™. Customers can also visit the mobile site from their devices at mobile.bankaf.com without installing a mobile app.
For questions about mobile banking call 800-815-BANK or use the “Live Chat” feature on the bank’s website at www.bankaf.com.
Although mobile banking is provided by Bank of American Fork free of charge, you may be charged access rates depending on your mobile carrier. Web access is needed to use mobile banking. Check with your service provider for details on specific fees and charges.
† Enrollment in Mobile ExpressDeposit is available in mobile banking and includes meeting eligibility requirements. For consumer accounts there is a $0.50 service fee per deposit on the first 20 deposits processed in the calendar month and a $1.00 service fee per deposit on each deposit over 20. For business accounts there is a $0.50 fee per deposit on the first 60 deposits processed in the calendar month and a $1.00 fee per deposit on each deposit over 60. For full details, please visit the Mobile ExpressDeposit product page.
‡ Online customers must first enroll in PowerPay™ and establish payees in online banking prior to using this function in mobile banking.
iPhone, iPod Touch, iPad and iTunes are registered trademarks of Apple Inc. App Store is a service mark and iTunes store is a registered service mark of Apple Inc. Android and Android Market are trademarks of Google Inc. PowerPay is a trademark of Jack Henry & Associates, Inc.
CEObuilder and Bank of American Fork invite you to join us on Wednesday, September 18, 2013 for a forum and presentation by Tim Schaeffer, vice president of strategic development for Listen Technologies Corporation. Schaeffer’s presentation will focus on best practices for sales management. You can also join the conversation on Twitter at #ceobuilder or LinkedIn.
Some people feel like “sales” is a dirty word. “Salesperson” brings up visions of used-car salesmen. Tim Schaeffer will explain how to overcome this perception and what it means to be a professional salesperson. He will help to demystify the sales process and explain the seven steps to a guaranteed close.
We will also discuss best practices for sales management and sales reporting, including the benefits (and pitfalls) of CRM tools.
This forum will be held at Bank of American Fork, Riverton Branch Conference Room, 2691 West 12600 South, from 8:30 a.m. to 4:30 p.m. on Wednesday, September 18. Please RSVP by Monday, September 16 by contacting Heidi at Heidi.firstname.lastname@example.org or 801-642-3139.