ABA Banking Journal - October 2008 - (Page 36)

RETAIL BANKING REPORT Still pushing the envelope Now $8.3 billion, offbeat Umpqua Bank is “no gimmick,” says CEO Ray Davis. In an interview he credits culture and empowerment for the bank’s success L ong before the value of a cup of joe and an overtly retaillooking environment was conventional banking wisdom, Portland, Ore.-based Umpqua Bank offered its customers coffee and a chat. The bank’s sharp-looking branches began popping up in Oregon at the forefront of the experience-design movement after CEO Ray Davis and his team bought into an idea that said, don’t be visually boring and support your brand in your branch outlets; the investment will pay off. The idea of all of it? To make financial products tangible and customers feel like banking could be more than an errand. With 148 stores that sit between Napa Valley and Bellevue, Wash., and a growing reputation as a bank that’s reinvented the rules of retail banking, Umpqua is succeeding on the terms of differentiation it set out for itself. Certainly there have been pressures. In 2007, the bank experienced just 5% organic growth, well down from previous years, and reported earnings of $65.3 million, or $1.08 per share, down from $1.63 per share. Yet, there has also been progress. That same year, the bank acquired $727.8 million-assets North Bay Bancorp based in California’s Napa Valley. Last November, the bank launched its Innovation Lab in Portland (shown above), a one-of-a-kind branch run with technology partners to help the bank figure out new approaches to retail service, even as it addresses the needs of tech lovers. Not a bad year in an environment characterized by drastically downsized performance by many. Also in 2007, Davis wrote a book, Leading for Growth: How Umpqua Created a Culture of Greatness, and the bank ranked 34th in Fortune Magazine’s Top 100 Companies to Work For in 2007. Early in September, ABA Banking Journal talked with Davis about retail delivery, strategy creation, and execution. With a reasonable demeanor, Davis is certain without being arrogant—sure of his bank, without preening over it. How would you describe your bank’s retail delivery strategy and why it has been successful? Our strategy has been to engage the customer by dramatically changing what happens at a branch. Back in 1994, when we were looking at the competitive landscape at an asset size of $140 million we asked the question, why should anyone do business with us? It was clear that we couldn’t out-resource, out-gun, out-man, the big banks. So we set out to differentiate ourselves in customer Subscribe at www.ababj.com By Lauren Bielski, senior editor 36 OCTOBER 2008/ABA BANKING JOURNAL http://www.umpquabank.com http://www.amazon.com/gp/product/0787986070?ie=UTF8&tag=ababankingjou20&linkCode=as2&camp=1789&creative=9325&creativeASIN=0787986070 http://www.amazon.com/gp/product/0787986070?ie=UTF8&tag=ababankingjou20&linkCode=as2&camp=1789&creative=9325&creativeASIN=0787986070 http://www.ababj.com

Table of Contents for the Digital Edition of ABA Banking Journal - October 2008

ABA Banking Journal - October 2008
Contents
Editor’s Column
A Banker's View of FHA's "Hope for Homeowners" Program
Snapshot: Branch Sales Sag to Ten-Year Low
Covered Bonds Gain Interest after GSE Takeover
ABA Chairman’s Position
ABA Resources
Hot, Web, and Green
Rethinking Segmentation
Still Pushing the Envelope
Keep Regulation Functional
Capital Windfall?
Mortgage IT: Not This Year's Hot Property
Case in Point: Looking for Sales in All the Right Places
Put Your BSA/AML Program into Shape
Mailbox
Banker’s Mart
To Advertise/Index of Advertisers
Remembering Joe Kizzia, Veteren Editor of ABA Banking Journal
100th Anniversary: Then & Now
The Economy

ABA Banking Journal - October 2008