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An Interview with Adam O'Daniel - Community Banking from an Outside Perspective
June 01, 2015
At the time of this interview, Adam O'Daniel was the Finance Editor at the Charlotte Business Journal. Mr. O'Daniel served in this role for more than four years affording him a front row seat in the country’s second largest financial city to cover banking, finance, small business, and economic development. We asked Adam about his thoughts on the state of community banks now, and in the future. His responses were honest and quite intuitive. He recently left journalism on May, 1, 2015, when he accepted a new position as Content and Public Relations Manager with QuietStream Financial in Charlotte, North Carolina.  QuietStream is a fast-growing commercial real estate business that specializes in making the complex simple through a portfolio of businesses from defeasance and due diligence to crowdfunding and solar generation. 
1. How do you define “community bank”?  How will this change, if at all, 10 years from now?
Community banks are getting bigger, and I think that will continue over the coming years. It’s no secret that regulatory costs, economic factors and changing demographics all contribute to this trend. Banks with more than $5 billion in assets seem to trade at higher multiples and benefit from that size and scale. So I’d expect more $5-8 billion lenders serving entire states or several large metro areas, plus more $1 billion banks focused on single large metro areas and contiguous regions.
For me, a community bank in its truest sense is laser-focused on a single community. That’s more important than whether it’s $200 million in assets or $2 billion. Banks that have spread out across multiple states may be community banks at heart, but they also have to think and act more like small regionals.
2. What are some of the more promising or interesting things that you see community banks doing to compete or better serve their customers?
I’m impressed with some of the technology being offered. One of the smaller banks here in Charlotte has a debit card on-off switch through a mobile app. How cool is that? High-tech banking isn’t just for the big boys on Wall Street. Smaller lenders are now able to offer compelling technology options.
3. If community banks would substantially decrease in number through consolidation, etc., what effect, if any, do you think it would have on the communities that they presently serve?
My concern is for the smallest towns. The banks themselves may actually become stronger and provide more services as they grow. But, small rural areas are at risk of losing competition – or losing their only bank branch altogether. I’ve seen that happen in a few places. The large banks have made it clear small towns are not their priority. And, if community banks shrink in number, what’s a small community in the middle of nowhere supposed to do?
4. Community bankers will tell you they have been unfairly demonized (by being lumped in with the “Wall Street” bankers) since the Great Recession. What can community banks do to improve their image…besides advertise in the Charlotte Business Journal?
Advertising, of course. But seriously, I tend to believe the proof is in the pudding, so to speak. This would apply to all industries. Rather than worry about burnishing an image, the companies that worry about doing a great job for their customers everyday also benefit from an improved image. Do a great job for your customer and the image will fix itself.
5. You had to have seen or heard about everything while covering Charlotte and banking during the Great Recession. What did you learn about banking from covering it?
Everything. When I started in this job in 2008, my banking knowledge was limited. My colleagues coached me, introduced me to talented bankers in Charlotte and I learned the industry on the job as it went through some of its darkest days. I like to tell people I started in Charlotte at the same time Wachovia hired Bob Steel as its next CEO. Only one of us is still on the job. So, obviously, this has been a great opportunity for me.
6. In your position over the years, you have interviewed countless bankers.  Can you tell us from your experience, what sets apart the successful banker or executive from the mediocre? Is there something that you can see early on in their personality or behavior that tells you that this person will succeed?
I’m not sure I can tell you what makes one more successful than another. One thing I appreciate in the bank executives I’ve come to know is honesty. You learn to know the difference between the bankers that are cheerleading and spouting the company lines and the executives who can speak truthfully and sincerely about their accomplishments and challenges. As a journalist, naturally I prefer to deal with the latter.   
7. What should bankers be paying attention to on the regional or national level (relating to specific trends or something happening in Washington) that they may be missing?
One interesting thing we don’t write much about, so others are probably overlooking it too, is the rise of alternatives to traditional banking. I think pre-paid cards through Wal-Mart and others, small-business loans through online exchanges and the rise of crowd-sourcing and crowd-funding all present challenges to community banks. I haven’t seen many community banks actively looking at how they’ll respond to the growth of credit and banking services from non-bank institutions.
8. What is the best part about being the Banking and Finance Editor for the Charlotte Business Journal?
I’m surrounded by smart people. We’ve got a great team in this newsroom. And, in Charlotte, I get to meet and learn from successful men and women who are driving businesses at the highest level. Not many jobs would give me that opportunity.
9. What gives you the most optimism about banking?
History. Banking is similar to other pillars of commerce, such as transportation and trade, which have been around for eons. It changes forms as society shifts, but throughout history, people and businesses have always needed access to credit and safe places to store their treasures. Banking is being reshaped by technology and economic changes in the 21st century. But, banks that innovate and deliver for customers with safety and soundness shouldn’t be worried.
Community Banking