Knowing market, clients Issa’s edge

ALWAYS RIGHT: Customers Bank Executive Vice President Steve Issa is applying his experience with the local market to his new role. / PBN PHOTO/RUPERT WHITELEY
ALWAYS RIGHT: Customers Bank Executive Vice President Steve Issa is applying his experience with the local market to his new role. / PBN PHOTO/RUPERT WHITELEY

Steve Issa has been mining the commercial-banking territory as executive vice president and New England market president for Customers Bank since last March. It’s a deeply familiar landscape. He had a similar position with Flagstar Bank when its New England commercial portfolio, along with its 14-member team, was acquired by Customers Bank. Issa is part of a former Sovereign Bank team largely reassembled at Wyomissing, Pa.-based Customers Bank by CEO Jay Sidhu.
In nearly a year of working from the sixth floor of the Textron building in Providence, the Rhode Island banking veteran has led his team to 50 percent growth in both clients and dollar value of the commercial portfolio.
The bank is opening a residential mortgage office on the ground floor of the Textron building by the end of the month. A new Customers Bank Specialty Finance Group is also based in Providence.
PBN: What market segments are your New England clients in, the ones that transitioned with you from Flagstar?
ISSA: It’s a lot of manufacturing, a lot of distribution, some commercial real estate projects in Rhode Island and Massachusetts, some professional firms. It’s a generalized commercial portfolio.

PBN: What’s the focus of the new specialty finance group?
ISSA: [It will] handle deals like equipment financing, asset-based lending and other types of specialized lending throughout the bank’s footprint from Pennsylvania through New England. It was a fourth-quarter event to be launched by end of first quarter 2014.

PBN: Is that a positive development for Providence, having that specialty team based here, especially in terms of hiring?
ISSA: Yes. We started with 14 in Boston and Providence, just about evenly divided with seven in each office in March 2013. We grew to 10 in each office. We added three people in Providence in the second half of 2013, so we’re up to 13 here. The reason the additions have been here is because Providence is where we have product specialists, cash management, capital-markets specialists and customer-support specialists. Now we’re looking to add approximately three-to-five new people in Rhode Island in the first four months of this year for the Specialty Finance Group. It will probably be two relationship managers, one or two portfolio managers and one customer-support person.

PBN: Are you adding employees in other areas, besides specialty financing?
ISSA: Yes. We just formed a residential mortgage group, which will be headquartered here and housed on the first floor. It launched in January and the office is expected to open at the end of February [with] three people – a team leader, two residential-mortgage originators and potentially two more in the second quarter. So there will be five in that group, initially, and we’ll add each quarter as the volume dictates.

PBN: Will that residential mortgage group be Rhode Island-focused or working in the broader New England market?
ISSA: The two mortgage originators who have been hired will be focusing on Rhode Island and southeastern Massachusetts. We’ll be hiring a couple of residential-mortgage originators in Boston at some point in the near future. We’ve already actively begun looking for people.

- Advertisement -

PBN: Is that a sign that the housing market is improving?
ISSA: We feel quite good that there’s an opportunity there. We’ve already received six or seven residential-mortgage applications from our existing commercial customers or just people who have found us.

PBN: Customers Bank doesn’t have any retail branches in Rhode Island, so is that planned for the future?
ISSA: There are branches from Rye, N.Y., through New Jersey and Pennsylvania. In New England we do not have any branches. The plan here was to start commercial first and work into the residential mortgages.

PBN: How many commercial clients did you begin with when Customers acquired Flagstar about a year ago?
ISSA: It was about 50 customers totaling about $150 million in loans outstanding. We’ve increased that number by approximately 50 percent. We have about 70 to 75 clients in the portfolio and dollar size has also increased about 50 percent, so the commercial portfolio is about $225 million.

PBN: Are you taking market share from other banks?
ISSA: We’re growing our existing customer portfolio – they’re building inventory, buying product lines. We’re getting new clients as we get referrals from the business community. We’re also working with other banks. We get referred in by a number of banks that are the lead if they’re doing a large real estate project or a customer is making an acquisition of a competitor – we get called to do deals with them. What’s happening is that with the regulations so tough, a lot of banks are at their total lending limit with some customers they’ve had for many years, so they call us. There’s got to be a trust factor that we’re not going to try and swipe the account from them. We’ve also … gotten a couple of very large requests where we’ll be the lead bank and we’ve participated back to a few of those banks.

PBN: What do you think Customers is doing differently from other banks that makes it attractive to commercial clients?
ISSA: We have local authority. I can cover 90 percent of the loan requests that come in the door. A lot of larger banks have centralized lending authority.

PBN: Has the competition been tough?
ISSA: It all comes down to people. The people in the Boston office have worked in that market for 25-plus years. It’s the same in Rhode Island. The people are known. I’ve been in banking in New England for almost 37 years. Many of the clients will follow the banker they’ve had for many years, assuming the bank has all the products and services necessary. I’ve had some clients since 1983 and 1985. We’re lending to their sons and daughters who are running the companies. We’re lending to their grandkids. This is still a personalized business. •

No posts to display