Banking on Slade’s Ferry

Mary Lynn D. Lenz at the Slade's Ferry Bancorp<br>headquarters in Somerset, Mass.
Mary Lynn D. Lenz at the Slade's Ferry Bancorp
headquarters in Somerset, Mass.

Somerset bank retains southeastern Mass. focus

Mary Lynn D. Lenz

Position: President and CEO, Slade’s Ferry Bancorp, Somerset,

Background: Executive vice president and director of retail banking,
Citizens Bank of Massachusetts, 1998-2002; Key Bank, Buffalo, N.Y., 1991-1998,
most recently serving as a senior vice president; Key Mortgage Funding Inc.,
Buffalo, 1989-1991; and Empire of America, Buffalo, 1984-1989.

Education: New York State University, College of Buffalo and Niagara

Residence: Boston

Age: 48

Somerset, Mass.-based Slade’s Ferry Bancorp, parent company to Slade’s
Ferry Trust Company, is publicly traded on the NASDAQ. The bank has more than
$420 million in assets and 11 retail branches in southeastern Massachusetts.

Mary Lynn D. Lenz was named the bank’s president in September 2002. Since
joining Slade’s Ferry, Lenz has been charged with boosting the bank’s consumer
banking business, balancing it off with its strong commercial business side.


Q. Southeastern Massachusetts has a number of small, very strong banks
and credit unions. The bigger banks don’t dominate this territory like other
parts of the state. Why is that?

A. The larger banks of New England have focused on the big urban areas,
and some of the larger communities. I think we have been somewhat insulated.
I also believe that the demographics, the households, in these communities love
their community banks. They love walking in the door. I can’t tell you how many
times a customer has walked into the bank and asked what was happening with
our stock price or hear, ‘what do you have for CD’s today.’ The demographic
likes that personal care.


Q. Within this market, what is Slade’s niche?

A. I believe Slade’s Ferry has been predominately known as a commercial
bank. I think as a group, though, we have done a pretty good job in evening
the commercial and consumer sides. So we’re not just a commercial bank. For
instance, if you look at our results you will see that we have had some tremendous
growth in our mortgage portfolio and our home equity portfolio. That was a result
of us going out talking to our customers and potential customers, telling them
that we could take care of those needs.


Q. Breakdown the commercial vs. consumer banking business for Slade’s.

A. If you look at our portfolio composition you will see that the
greatest proportion of our portfolio is commercial lending. How has it changed?
We have implemented a consumer lending division, focused on being able to originate,
process and close first-mortgages and home equities, personal loans and auto
loans. And we have advertised them, which was new for Slade’s. We had done some
advertising, but not to such a high level. We have engaged in a partnership
with an outside marketing group, Black Diamond Marketing, which has been able
to help us position ourselves in the community. Our message is being heard.


Q. What other issues did you face in taking this job over a year ago?

A. We had some performance challenges. If you look at some of our
operating ratios compared to some of our peer groups, we were not performing
at stellar rates. We knew there was opportunity for improvement, and we just
needed to figure out how to get there. We needed to balance our portfolio, needed
to improve our return on assets and we needed to improve our efficiency ratio.
Slade’s had been steady as you go, but there was opportunity to improve it.
Some of it was very simple. For example, you can improve your efficiency ratio
by implementing your technology platform. By doing that you can take out other
costs within the company.


Q. Because small business is still a key to your business, how active are
you in promoting and aiding economic development in this region?

A. The bank is very integrated into economic development issues. I
sit on the Fall River mayor’s economic development group, Jobs for Fall River.
We are also involved with the local Chambers and I sit on a variety of boards
with UMass Dartmouth, which focuses on economic issues and education issues.
As a bank, we are very focused on education. Economic development and education
connect. Until we ensure that the children that grow up in this community are
provided with a good education, stay in school and go on to college we are not
going to be able to supply the various industries with good leaders.


Q. What is the current state of the southeastern Massachusetts’ economy
and where is it heading?

A. From my perspective, it is made up of small business, not big companies.
Some of the small businesses have been handed down in the family over generations,
but there are also a number of new emerging companies. There are tons of opportunities
for these small businesses. The members of the community, again, like the small
businesses. They like knowing the person who runs and owns the company.


Q. How would you describe your typical small-business client?

A. It’s a business that could be from five to 10 employees in size.
Most of what we see are service providers. It’s usually people who will set
up their business using their savings or take equity out of their home. Others
will go through the Small Business Administration for loans.


Q. You talked about the importance of producing a well-educated work force
to supply the entire economy. How about your industry specifically? Are you
finding the workers you need?

A. We are finding very articulate people and they are very willing
to learn. We have implemented some very aggressive training schedules so we
can help people along their career path. For instance, we are just initiating
a management-training program, in which we select people from our teller ranks
– our entry-level positions. We are going to start putting them on a career
path toward commercial lending, retail management and other areas.


Q. How does Slade’s, as well as the other smaller banks, go about marketing
itself in an industry dominated with giant banks that saturate the media with

A. It’s an interesting, interesting dilemma. I came from Citizens
Bank, and they are all over the place. First of all, we don’t have to market
in as many communities they do. Secondly, we will need to be pointed. That’s
why it is so important to partner with an outside (marketing) company. We need
to be very pointed on where we are going to find our most customers. We have
focused this year predominately on print media, because we did not have the
budget to do TV, to do radio, to do billboards. So far, we have received a lot
of attention through our print (efforts), because a lot of people read the newspaper.
In these communities a lot of people read their community newspapers. I don’t
think we need a multimillion-dollar ad budget to accomplish what we need to


Q. What type of growth should we expect from Slade’s? Will it be an expansion
outside the area or within?

A. This has been the first year of a three-year strategic plan, making
sure we have a full array of products and services, and ensuring we have the
right branches in the right locations. We have been very cautious, very thoughtful
and very patient to weigh expansion opportunities. During the next two years,
you will see those expansion opportunities begin to come to fruition.


Q. Do you see an expansion outside this region?

A. We want to stay within our footprint, the Southcoast.


Q. There are a lot of smaller banks in this area – Compass, FirstFed, Citizens-Union,
for example – as well as strong credit unions. Do you think this market can
support so many? Is there room for possible acquisitions?

A. If you look at our financials you will see that we have been able
to grow significantly, so I think that it is indicative of the opportunity out
there. I do believe there is opportunity to compete even with the competition
out there.


Q. How about acquisitions?

A. I don’t have a crystal ball, but there could be some. We have no
plans in mergers and acquisitions today, but there are always opportunities.
People are always talking to each other. We need to be mindful of what is right
for our customers.


Q. Do you have Rhode Island customers? Is there room to build on that business?

A. We have large customers in Rhode Island, and would like to expand
in that marketplace. I think it is similar to Southcoast, because it has a lot
of small businesses. There is a great amount of emerging businesses that we
are in partnership with.

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