Marking its 30th year, the Banker of the Year recognition program offers useful insight into leadership and what it takes to succeed running a bank in the Upper Midwest. Our 2018 selection, Larry Ness, chairman and CEO of First Dakota National Bank of Yankton, S.D., shares many leadership traits with previous Banker of the Year selections. Following are traits important in Ness’s success story, and examples of similar traits from previous selections:
Innovation – When Ness described his early years at First Dakota National Bank in the 1980s, he said he needed to downsize the bank. One way he did that was by encouraging large deposit customers to put their money into CitiBank certificates of deposit, which were paying more than First Dakota was paying. Customers appreciated the counsel and several moved their money. After First Dakota worked through its cease and desist order, it needed additional economical loan funding so it went back to those former customers and invited them to move their money back to First Dakota. Many of them did. “That was me being innovative,” Ness commented.
Most of our Banker of the Year selections have demonstrated great innovation. For example, Myron Pfeifle, the 1994 selection, set up one of the region’s first investment centers in the lobby of his Bank Center First in Bismarck, N.D. In another example, Catherine Jackson, the 1998 selection, made a good business at Citizens State Bank in Waverly, Minn., processing rebate checks for major companies around the country.
Be creative with the FDIC – Ness benefited from at least a couple of savvy deals for failed banks. The FDIC paid him to take over the American State Bank of Yankton in 1988, and First Dakota National Bank was there with Alerus Financial of Grand Forks, N.D., to help the FDIC resolve the 2009 failure of BankFirst in Sioux Falls.
In 2010, we honored John Morrison, Kurt Weise and Larry Albert of Central Bank, Stillwater, Minn., after they orchestrated the acquisition of several failed banks through the FDIC. A number of those deals involved loss-share agreements, which ultimately proved beneficial to Central Bank. The Central Bank team, like the folks at First Dakota, was very good at workouts, turning previously written-off loans into valuable assets.
Aggressively recruit talent – Ness hired away talented bankers from competitors in Sioux Falls and Pierre. These were bold moves that certainly boosted First Dakota while stinging the competition.
Bell Bank leaders Richard and Michael Solberg (father and son, respectively), were honored as Bankers of the Year in 2012. They were forging their way into central Minnesota and hired away a group of bankers from a competitor. Both First Dakota and Bell Bank have built extensive branch networks.
The recruiting proves a couple of points. First, employers need to pay attention to their employees and treat them well if they expect to retain them. Even if the employees have been at the bank a long time, no employer can afford to grow complacent. If the employees are good, competitors are sure to notice and some of those competitors may make a play for them. The other lesson: If you are a bank looking for talent, it may turn out the best candidates are working at the bank across the street. They may be fair targets for recruitment, but it may be important to consider how such a move might be perceived by customers and other community stakeholders.
See opportunity in a mess – Ness came to First Dakota in 1983 when the bank was in trouble. The Minneapolis-based Star Tribune newspaper predicted it would fail. A lot of people would have considered a job at the bank at that time to be a risky proposition. But not Ness. He saw opportunity at First Dakota and took the job. He invested himself and his treasure in the bank and turned the situation around.
In a completely different kind of mess, First National Bank North Dakota of Grand Forks was flooded and burned in April 1997 when the community was struck with a massive flood and subsequent fire which burned much of downtown. The bank rose from the devastation under the leadership of Randy Newman, who was honored as Banker of the Year in 2008. He was encouraged to leave Grand Forks and re-establish the bank’s headquarters somewhere else. But Newman made the commitment to stay and today the bank is at the center of a thriving community.
Active in the community – Every banker we have ever honored through this program has been active in their community and the industry. Some were national association presidents like 1992 honoree Alan Tubbs, Maquoketa State Bank, Maquoketa, Iowa, who was president of the American Bankers Association; and 1993 honoree David Ballweg, Community State Bank, Union Grove, Wis., and 1997 honoree Leland Stenehjem Jr., First International Bank & Trust, Fargo, N.D., who were both president of the Independent Community Bankers of America. Ness, a former president of the South Dakota Bankers Association, is active in many community organizations. In 2015, he and his wife, Diane, were honored as Philanthropic Family of the Year by the South Dakota State University Foundation, and earlier this year the couple was lauded as Citizens of the Year by several civic organizations and the Yankton newspaper.
Another great example of community involvement is our most recent previous South Dakota representative, 1996 honoree B. Michael Broderick Jr., First American Bank, Canton, who served in the state legislature.
Gratitude – Ness said he is thankful for his good fortune over the years and he credits the people around him for doing the work.
Many of our Banker of the Year selections have expressed gratitude for their success and acknowledged the contributions of those around them. Particularly memorable is this note, which concluded the feature on Mark Hewitt, Northwoods Bank, Park Rapids, Minn., who we honored in 1995:
“I realize I am very fortunate. The Lord has blessed me with an excellent job, a wonderful family and lots of exciting hobbies. I have an awful lot to be thankful for!”