Bruce Van Saun (the name is oldtime Jersey Dutch, like Van Sciver, or Frelinghuysen), new boss at Citizens Bank, the Rhode Island-based U.S. arm of Britain's Royal Bank of Scotland, says the bank, which competes with Wells Fargo, PNC, TD, BofA and Santander in Philadelphia and other East Coast markets, needs to improve. We talked yesterday. Highlights:
Citizens and its competitors: "We are coming up a little short. Our financial performance, it's not back to where we'd like it to be... The U.S. is a fragmented market. If you meld your team into a cohesive group with a good culture -- we've been able to do that -- if you know your customers well, their needs and asiprations -- they will trust you. That's how you win in banking... We're not all the way there."
On being the 25-year financial sponsor of Citizens Bank Park: "I'd certainly like to see the Phillies get back in the playoffs." Should Citizens have made the Phils sign a performance agreement? No wins, no sponsor payments? "(Laughs) We get mileage from that relationship. We do get a lot of recognition."
On Citizens' planned 25-percent initial public stock offering and what the bank will do with the money: "We're shooting to do that in the fourth quarter of 2014. It will give us much more visibility and brand identity and a stock we can use to retain our talent and attract new talent."
On why it's okay that the mother bank in England will pocket IPO proceeds: "We have a strong capital position. We don't need to reinvest that into the franchise. We've made $900 million in capital expenditures, we have $500 million more planned: in our basic technology offering, updating our platforms, making them more modern, investing in the ways the banking world is moving, online. We have, a couple of (industry publications) have said, the Number One mobile app of all the regional banks."
Is the economy growing? "We need to start growing our earning assets. We are adding loan originators."
Who is Citizens hiring? "We historicaly underinvested in mortgages; we were very strong in home equity and auto. (Wells Fargo) was surfing the home-loan refinancing wave and coined money off it. Now theyre throttling back. In our footprint we've punched under our weight. Now we are hiring loan originators. We want to grow...
"Same with wealth advisory. We weren't in it til 4, 5 years ago. Now have 360 wealth advisors in our branches. They have performed very well. Their productivity is above a wire service house (like, say, Merrill Lynch). But we are not yet at capacity. We will add more."
How about local business loans? "As the economy solidifies, small business is the engine for economic growth. So we should see a lot of opportunities. We plan to hire up for that."
Businesses say banks won't lend to any but the best borrowers. "I think it's been more of a demand issue. The economy has seemed soft. Until confidence improves and the economy starts to show more life they'd rather deleverage than build a factory or build a warehouse. That's it.
"We want to make loans. We have the capacity. Our loan to deposit ratio is 80%, we want to get to 100%. I think you'll see it. I think there's some green shoots. We've seen year-over-year growth in our business banking loans. In the manufacturing sector. You have a very diverse economy in southeastern Pa. It's picking up a bit."