What It Means To Be A Modern Bank

Lance Lemoine, President of the mortgage division at Evolve Bank and Trust, stops by Expert Insights to talk with host Joe Welu about how Evolve is modernizing its business. During the conversation the two discuss the bank’s incredible retention rates, staying relevant in the current financial climate, and making data-driven decisions. Key Takeaways:
  • [01:58] Background on Evolve Bank and Trust
  • [03:28] Lance’s story and the secret to success
  • [05:56] Sales and retention at Evolve Bank and Trust
  • [07:26] Serving your people and the customer
  • [09:20] On being data-driven and discussing best practices
  • [11:23] What it means to be a modern bank, and Evolve’s vision for the next decade
  • [14:15] Stay relevant to stay alive
  • [17:16] Lance’s thoughts on the current market cycle

Listen to the podcast here

What It Means To Be A Modern Bank

I am joined by the President of the Mortgage Division at Evolve Bank & Trust, Mr. Lance Lemoine. Welcome to the show. Thanks for joining. Thank you. I appreciate you having me. Mr. Lemoine has many years of experience in expertise in mortgage banking, capital markets, marketing and consumer lending. You were with Fleet National Bank, Fleet Mortgage, for fifteen years. You also had a pretty lengthy career at Wells Fargo and USAA. You’ve been to some well-known big organizations. You were also the CEO of AmeriPro Home Loans prior to it being purchased by Guild. I’m assuming I have all that right. I would love to get any additional context about your path to success that’s led you to where you’re at. It’s been many years. I feel like I’ve had a great career in the sense that work for some big banks and big mortgage companies. I spent some time with Country-Wide and some other smaller banks as well, some mortgage banking, independent mortgage bankers and banks. It’s been a fun ride and an interesting business we’re in. Give us a little bit of an overview of Evolve Bank & Trust, the organization, a little bit of the story, and any context you can provide about the bank. We’re a midsize or small bank with over $1 billion in assets that have been around for a long time. As a modern bank, over the last many years, we’ve become a consortium of national businesses. We’ve got a very large open banking platform that’s substantial in the marketplace. We’ve got Physicians Capital Group, a litigation trust, a nationwide small business lending arm, and a few branches in Arkansas and Tennessee. We’re not what you would think of as your typical bank. We are a consortium of national businesses. That makes us very entrepreneurial as a leadership group. You are thinking about how to serve all of those different businesses with the technology offerings that you are working on. It’s thought about in relation to all of those different businesses. I want to get into a little bit about your story and some of your secrets to success. I’ve consistently heard about your leadership, the quality of how you run the business, and how you build culture. To set the tone a little bit, as you look at where we are in this cycle, the markets are in a little bit of flux here. However, the long-term impact or benefit of owning a home in America is still going to be important. I know we agree on that. How are you guys thinking about serving the customer in terms of the market cycle we’re in with rates all over the place? Does it change your approach at all? Give me a little bit of context on that before we get into some of the deeper items. The word that you used there is central to how we operate as a service. You talked about leadership as well and I have benefited by being able to surround myself with good leadership. At Evolve, we are hyper-focused on service levels. When you say service levels in our business, that means you make your closings on time, which we do 99% to 99.5% of the time. 100% of contracts were closed on time. More importantly, it’s about individuals serving one another and having that strong spirit team approach. It’s a difficult market out there. We’ve got some great salespeople on our team and referral partners. Everyone is relying on us to close on time and serve one another on time. Every division and department has to do with communications. Matt Knueven who runs our operations sends out a daily email that details everything that’s going on throughout our entire pipeline. We’re completely transparent and confident in what we do and focused in on it. You have one of the highest retention rates of your sales team of any of the lenders or banks that I frequently talk to. That’s been an area of struggle for a lot of organizations. You come in as somebody that does a great job at that. Can you share with the audience your thoughts on that? How have you managed to create a culture that people want to continue to be a part of in this environment? Have you noticed any challenges with retaining people as the market has changed? There are always challenges in retaining people, but if you can provide great products, service, support and communications, friendships, and partnerships along the way. That’s what we all need to focus on. We have a lot of reward and recognition programs in the president’s clubs and various daily and monthly announcements to try to create that sense of belonging and support. It comes down to being resolute in that hyper-focus on service levels. There are always challenges in retaining people, but if you can provide great products, service, support, communications, friendships, and partnerships along the way, that's really what we all need to focus on. Click To Tweet When you say service level to your people as well as to the customer, is that accurate? Exactly. This is an important distinction. We spend a lot of time working and talking with partners, organizations, and both customers and tech partners that we have. Everybody is talking deeply all the time about serving the customer and creating experiences and outcomes for that customer. This is something that I’m catching from you that I want to maybe see if is fair or not, and I’ll make my own assumption here. The way you intensely focus on serving your people directly plays into the reason you’ve been able to retain them. Part of the role of leadership is to serve those people. I’m glad you made that delineation because I was spouting the whole service thing. Whether it’s our capital markets or secondary team lock desk, underwriting, closing disclosure, you name it, anything that goes into the daily workings for our teams that are out there working with our referral partners. We’re hyper-focused on ensuring that they get what it is they need. I was a top originator as a young man a long time ago. It’s the same with our head of ops, our national production leader, and many of our other leaders. We understand what’s going on in the transaction and being purchased-focused, 95% of our businesses purchased is realtors’ buy side, sell-side, and families that are moving in, moving out, and all that anxiety that goes with that. Having that service level approach 360 helps. You’re always looking through the lens of somebody that is an insider, somebody that has walked in the shoes of the person that’s originating. I see a lot of leaders who talk about serving their people and having good intentions for a lot of people. When it comes down to doing that over time and the execution of that, I see a lot of organizations struggle with it. Do you have any best practices that you have in place to measure how you’re doing? I’m assuming your goal is continuously to have a deep level of service to your people and your customers. How are you measuring those things or are you staying involved deeply? We do a lot of things. We survey our employees and borrowers, and we try to survey our realtor partners. There’s a lot of internal and external surveying that goes on. We track and report daily on how we’re doing various measures and whether it’s underwriting, turn times, days to close, and things of that nature.
Modern Bank: There's a lot of internal and external surveying that goes on. We track and report daily on how we're doing.

You’re very data-driven. When you’re thinking about service, you’re data-driven in the analysis of that, the tracking, and the benchmarking. From what I understand, how you keep focused on progress and where you’re at is by using data.

Something else that’s important to mention here that we are fortunate to have is bank ownership and a board that is very familiar with mortgage lending. We’ve been in the mortgage business for many years. They’re very committed and interested in our business, whereas, in some other companies, that can sway depending on which way the markets are swaying.

We talk a lot about what it means to be a modern bank, a modern lender, and how things evolve. Based on the additional businesses you are involved with, you’re already pretty far down the evolution of changing the status quo from being a traditional brick-and-mortar bank to something different and something bigger. How would you articulate the vision for the bank over the next 3, 5, or 10 years?

Our bank prides itself on being very closely aligned with many FinTech industries. Our open banking platform got 950 or 1,000 FinTech partners to whom we provide payment solutions and other products for mortgage lending. We want to get better, faster, and cleaner and mortgage banking requires a perfect execution of the mortgage on the front end if you want to sell it on the back end. That’s going to require some investments in technology, which we’ve been doing for several years now.

Mortgage banking requires a perfect execution on the front end if you wanna sell it on the back end. Click To Tweet

We have several projects underway with improving our front-end mobile app, CRM, sales solutions, and customer information so that we can help manage that journey or maybe react to the needs of that customer journey, not necessarily manage their journey for them, and improve our front-end loan origination system. We’re undergoing all of those things with the hope that they will all kick off here.

You are leaning in and investing in the organization and tech broadly and continuing to make progress in a variety of different places. All of these impact not your end customer in better outcomes, but also what I know about you is that you’re also investing in technology, realizing the way your people work and serve the end customers is changing also.

They go hand in hand. I don’t want to say it’s the hope that then helps deliver a better service to the end customer. We all know that it will. It’s a matter of investing and making sure that those projects go online at the appropriate time.

An average bank that is maybe more focused on being traditional that’s not as comfortable making changes or pushing the needle to modernize, to invest in tech, what advice or thoughts would you give to those types of organizations that are maybe saying, “We’re not going to continue to modernize and make these big investments. We’re going to stick to what we know?”

It’s hard to say anything to the organizations themselves. What I would say to the leaders in particular divisions, business units, or whatever is to have the courage or be resolute to break down the bureaucracy. If you’re going to stay alive, relevant, and competitive, you have to demand. That’s where the challenge is. I don’t have that bureaucracy.

Modern Bank: Have the courage and be resolute, to break down the bureaucracy. If you're gonna stay alive, relevant, and be competitive, you have to demand.

I’ve got a tremendous board and executive leadership team at the bank. We make sound rational business decisions. That’s why some of our locations and branches have been with us for many years. That benefits us. That’s where some of the larger banks in particular, or any bank that’s fraught with a little bit of bureaucracy. If you get more than twelve people, you could end up with bureaucracy.

I see that in organizations, both large and small. That can be overly bureaucratic. It sounds like this is one of the reasons you’re successful. You don’t have this analysis paralysis. You make data-driven decisions efficiently and quickly. Even if it’s not perfect, you’re able to make progress pretty rapidly. I don’t think size necessarily is the deciding factor, but if you compare that to a lot of organizations that are maybe stuck in the mud a little bit and feel like they’re a slow-moving ship versus something that’s more nimble, it tends to be overly bogged down in the decision-making process.

People that are willing have the courage to be committed to having a growth mindset and moving the needle forward, positioning the organization for the future. You’ve had a very successful career. You’ve been in the industry a long time. You’ve seen a lot of cycles. Broadly speaking, lending is in a contraction cycle in terms of fewer transaction volumes. As you look at rates and home prices where they’re at, over the next years, what does your crystal ball see? What do you see happening with the markets, transaction volumes, and home ownership?

We’re in an interesting environment. One thing that I don’t have is fear of what’s coming because there are lots of good signs. We’ve got a burgeoning economy. Underwriting of credit has been very sound. This certain cycle that we see with rising values of homes and such demand, I don’t see that we necessarily have a bumble. That’s my opinion. Going back to blocking and tackling, I see our teams having events and meeting with referral partners. They hadn’t met within the last couple of years for a particular reason.

Hopefully, that’s behind us and that can continue. We came out with some portfolio products, some 5, 7 or 10-year arms to respond to interest rates, starting to approach 6%. We’ve tempered back to 4 and 3 quarters 5 and 8. We’re seeing some continuity there. Rates have been there for 30, 40, to 45 days. The market’s starting to accept that. We’re seeing more margin coming back in that product, a lot of homes go on the market and good activity on the purchase side.

The bottom line, you’re incredibly bullish long-term and that home ownership is going to continue to be important and markets are going to balance themselves out.

It’s about maintaining your particular share in your particular market.

Thank you much for joining. I appreciate you taking the time to share some of your expertise and insights and the great work you guys are doing at Evolve Bank & Trust. We’re huge fans of the organization and the brand. Thanks, everyone, for joining us. We’ll see you next time for another episode.

Thank you. I appreciate it.

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About Lance Lemoine

EXIN 10 | Modern Bank “Throughout my career I have been driven to find business solutions that create new opportunities in the financial industry. These innovations have been applied within Wealth Management, Consumer lending, and Mortgage Banking companies with revenue ranging from $100M to $100B. The broad reach of my career has afforded me relationships with mentors and leaders from top financial companies.

Their collective thought leadership has shaped the way I approach business solutions and lead teams. The greatest impact to my career and professional outlook comes from the teams and individuals I have worked with on a daily basis. Our team here at Evolve is top tier, welcoming and supportive and we all row in the same direction every day. It’s a pleasure to come to work every day and serve our clients and teams needs”