California Bank & Trust (CB&T), a division of Zions Bancorporation, aims to help business clients grow and prosper. In operation for nearly 70 years, CB&T is a full-service bank specializing in business banking.
With $13 billion in loans, $15 billion in deposits, and 85 branches located throughout California. Headquartered in San Diego, CB&T has nearly 1,000 employees with offices across the state.
Eric Ellingsen has been named the new president and chief executive officer of CB&T, overseeing all banking activities in California
Last week the San Diego Business Journal had a chance to talk with Ellingsen and ask a few questions.
What are your views of the Southern California banking market and the San Diego market?
The activity this year in the banking sector has been largely driven by business and consumer needs stemming from the pandemic. We saw economic conditions trend a bit better in the fall and it seemed like businesses, for the most part, were getting used to operating with the COVID-related restrictions and finding creative ways to adapt. That said, clearly, travel, entertainment, lodging and restaurants have been particularly hard hit this year.
However, this most recent stay-at-home order has the risk of having a negative impact on small businesses and employment in the affected sectors; but we stand ready to provide support in 2021. Right now, the banking sector remains healthy with credit quality relatively strong considering the significant impact the pandemic has had on economic activity. CB&T is open for business and our branch associates have done a phenomenal job continuing to serve customers during this time and under very difficult circumstances.
Your bank provides women and minority-owned business loans. How active is that market?
We’ve historically done well in these areas. We’re in the process of creating a new set of business credit products that are specifically targeted to underserved communities and minority and women-owned businesses. We plan to launch this early next year. We’ve been working with our primary regulator and are trying to take a leadership position in our industry.
However, the industry as a whole can and should do more. About 18% of businesses are owned by minorities and 20% are owned by women. Those percentages should be higher, and we will be focused on this in the years to come. We’re a diverse employer with more than 50% of our workforce identifying as minority, which is something we’re very proud of.
Is consolidation still a big factor in the market?
The pandemic has slowed consolidation activity in the banking industry this year, because it was extraordinarily challenging to try to acquire and integrate another bank in the midst of the pandemic. This year, the deal volume is less than half compared to 2018 and 2019. There’s still consolidation happening, and we’ll see continued consolidation in 2021.
Has your bank embraced technology?
There’s been a lot of innovation and advancements in technology in our sector. We have embraced technology as a company and continue to replace technology, as needed. For our bank, in 2021, we will launch a new mobile app and online banking interface with enhanced functionality. We will also have completely replaced our core systems by 2022.
How’d your bank handle the volume of PPP (Payment Protection Program) Loans? Was it challenging?
It was extraordinarily challenging. Here in California, we took more than 13,000 applications in several weeks, and successfully processed and funded more than 10,000 loans totaling about $1.6 billion.
During the peak, our bankers worked around the clock to support their customers with processing their loan requests. The CB&T team rallied and rose to the challenge in just an incredible way — it was quite the undertaking. We saw volume that you’d typically see in a year, in weeks, and due to time constraints and limited funding we had to process very quickly.
Your bank provides customized and tailored approaches. Can you elaborate on this?
We’re a large bank, we have about a thousand employees in California and more than 40,000 business customers. We do our very best to get to know all our customers and pair them with assigned bankers who take the time to understand their respective business, personal financial needs and situations.
We do business in a very personal way. Also, we enjoy low employee turnover at our bank. Our customers get a lot of continuity with the people they do business with, which is extremely helpful. We’ve created a great place to work and build a career and that’s why associates stay.
Like other traditional industries, financial services firms have had some trouble retaining millennial workers. What strategies have you employed to improve retention?
Over the last few years, we have done a lot of recruiting at colleges including here in town at University of San Diego, UC San Diego, and San Diego State University. The demand for our entry-level Banker Development positions has been overwhelmingly positive. We’ve seen 100 applicants for every single position that we had available under this program. It’s very encouraging that we’re building a bench with a clear development plan to train and retain these new bankers.
We have a high degree of focus on employee development in general. We make sure that our employees have a development plan, professional growth, and exposure opportunities to senior management.
It’s becoming increasingly important for candidates and younger generations to work for an employer that embraces corporate social responsibility, such as being environmentally conscious or providing time off for volunteerism, which has been part of our focus
What is the long-term vision for the bank?
This year, we acquired more than 3,000 new business customers across the state as a result of the Paycheck Protection Program. Roughly 49% of the loans we made were in majority minority census tracts and 27% were in low-to-moderate income census tracts. Those new customers provided a huge opportunity for us to continue to grow the bank while taking care of an urgent need that they had.
Across the state, we probably have a relatively low market share. California is a huge, vibrant economy. There’s a lot of opportunity for continued growth and we have a lot of runway ahead of us as a bank. We’re focused largely on growing organically by adding bankers and acquiring new customers.