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Lenders: Will you have a job when M&A rolls?

Taking a personal inventory, plus 4 tips for survivors

“There’s really not much that indicates we’ve learned anything new over the last several cycles,” says veteran lender and CEO Ed O’Leary. He aims to fix that. “There’s really not much that indicates we’ve learned anything new over the last several cycles,” says veteran lender and CEO Ed O’Leary. He aims to fix that.

Jeff Gerrish’s blogs lately have mentioned the steady stream of community bank consolidations and the reasons that these are likely to be a marketplace reality for the foreseeable future. But what does that say about employment opportunities for commercial lenders? Could these be vulnerable jobs in the next few years?

I’ll give you an unequivocal “maybe.”

Why a maybe?

First, consider some reasons to think that lending jobs are relatively safe in a prolonged period of consolidations of community banks.

There has been an apparent trend in recent years for community banks to do less formal credit training. Instead, they have tended to rely on aggressive recruiting of experienced lenders to fill open positions.

In other words, there may be a scarcity factor developing among trained credit professionals.

Lenders are primarily business developers. Anyone with a few years experience and a demonstrable record of business development is usually among the last to be negatively impacted in a merger or consolidation.

It’s unlikely that a robot will replace you. Commercial lending—and that includes the ongoing servicing of commercial borrowing relationships—is a face to face sort of activity.

People who serve people. Commercial lenders with several years of experience in their local markets tend to have “followings.” This doesn’t directly translate into job security. However, customers want stability and continuity in their banking relationships. This means that lender “churn” upsets customers. And that is a reason that management will tend to avoid disruptions that customers detest.

Commercial lending jobs do not confer lifetime tenure to their occupants. We have to earn our keep and it’s important to understand the primary metrics of those sorts of calculations.

4 ways to hold onto your job

Here’s my short list of “To Dos” based on a career lifetime of commercial lending and commercial lending management. These are not deep secrets. But it’s amazing how little time and attention some lenders seem to give them as guide posts in the career sense to answer the question of, “How am I doing?”

1. Periodically calculate the size of your portfolio by dollar and by number.

You want to be known as someone who handles an ambitious workload.

Be aware how the number of problem credits can penalize this calculation due to the work-intensive nature of certain credits, especially problem ones.

2. Be sure that whatever your business development metrics are, you measure up favorably.

Over the long haul, it’s business brought in that superiors watch. But in the short- to intermediate-term it’s numbers of calls made and factors.

3. Use problem credit situations to demonstrate your value to the bank.

Remember that first responders to disasters run toward the problems and not away from them. There are few things that impress management more than a willingness to get one’s hands dirty and take on the sometimes-ugly work of cleaning up a mess.

4. Don’t spend all your time figuring out what your bosses want. Think carefully—and act quickly—on what your customers want.

All customers want a banker who visits them in their place of business and sees them in their “natural habitat.” That builds loyalty of a high order—if consistently practiced.

Keep calm, and produce on

So to those of you who are disquieted by the prospects of bank consolidations and concern about losing your jobs, take heart.

Producers are the last to go, and lenders are revenue producers. Producers generate the top-line growth and during this business cycle, that’s been a much bigger issue than cost cutting.

Know what your bosses expect and play to those “knowns.” You’ll have ups and downs but by knowing how you’re judged you can constantly work to improve the results. Remember too that not all of these metrics are formally stated evaluation criteria.

Some words for the veteran lender

If you’re in the second half of your career cycle, then you’ve probably got these things pretty well figured out. If you want to really punctuate a commercial lending career with successes that offer payoffs in psychological terms as well, figure out how to transfer what you’ve learned to the younger staff members.

There are few formal job descriptions with “mentor” explicitly stated. But lending is in part a “show me” occupation. Our extending a hand to our less-experienced colleagues can bring considerable rewards to both you and those you help.

I’ve often mused at how transparent we lenders are.

If we like our work, it shows.

If we’re good at business development, it happens.

But here’s what we often forget: our bosses and our colleagues see that—and they get it, too. So why not make a virtue of what we wear on our sleeves in the first place?

Going the extra mile for our colleagues helps assure both us and them of continued job success. And in this shrinking bank environment that we inevitably face in the next few years, it will stabilize our own employment prospects and assure each of us a seat if the music ever stops.

Ed O’Leary

Banking Exchange Contributing Editor Ed O'Leary, a veteran lender and workout expert, spent nearly 50 years in bank commercial credit and related functions, working with both major banks as well as community banking institutions. His last job before retiring was as the CEO of a regional bank headquartered in Alburquerque, N.M. He earned his workout spurs in the dark days of the 1980s and early 1990s in both oil patch and commercial real estate lending. O'Leary began his banking career at The Bank of New York in 1964, and worked at banks in Florida, Texas, Oklahoma, and New Mexico. He served as a faculty member and thesis advisor at ABA's Stonier Graduate School of Banking for more than two decades, and served as long as a faculty member for ABA's undergraduate and graduate commercial lending schools. Today he works as a consultant and expert witness, and serves as instructor for ABA e-learning courses. You can e-mail him at [email protected]. O'Leary's website can be found at

In mid-2016 O'Leary's "Talking Credit" blog received a bronze excellence award for the Northeastern Region from the American Society of Business Publication Editors.

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