Taking risks pays off big for former bank leader

A FULLER LIFE: Never shying away from a challenge, Merrill W. Sherman has had a major impact in Rhode Island’s business scene, as well as in its nonprofit sector. / PBN PHOTO/RUPERT WHITELEY
A FULLER LIFE: Never shying away from a challenge, Merrill W. Sherman has had a major impact in Rhode Island’s business scene, as well as in its nonprofit sector. / PBN PHOTO/RUPERT WHITELEY

Merrill W. Sherman knows a few things about banking.
In the early 1990s, she was named president, chairman and CEO of Eastland Financial Corp., and was charged with turning that institution around after years of losing money. She did it.
She was then recruited to serve as president and CEO and as a director at the then-new First National Bank of Vermont, only the second bridge bank ever created by the Federal Deposit Insurance Corp.
Then in 1996, she co-founded Bank Rhode Island, which through 2011 grew from $450 million to $1.6 billion in assets and became a major player in the Rhode Island commercial-lending scene. In 2010, she was named one of the top 25 most-powerful women in banking by American Banker Magazine.
Imagine what she could have done had she started out as a banker and not a lawyer.
“At the end of the day, I probably should have gone to business school and not law school,” Sherman said with a laugh. “I really liked making business decisions and supervising execution and making sure you put steps in place to make sure something gets done.”
A lot has gotten done in Sherman’s years in banking, and for her efforts, she has earned the Career Achievement award in Providence Business News’ 2012 Business Women program, an honor she finds “very flattering, and humbling, but there are so many people who contributed” to her earning it, she said.
Sherman, 62, grew up on Long Island, and then moved with her family to Colorado, returning to the East for college and law school. She began her banking career as legal counsel to Eastland Financial in 1991. Within six months, she was named to run the business.
“That was the cornerstone of my development,” she said. “I was a partner at a very large, regional law firm and was very comfortable, so there was a big risk of going into a failing institution. But for a variety of reasons, I was in a position to take a risk and willing to do it. I went into Eastland, rolled my sleeves up and started fixing what was a pretty difficult situation.”
She had great mentors there on the board, and overall it was “a terrific experience, and set the stage for everything I did after.” She hadn’t realized the CEO of Eastland was leaving, and when the board decided she was the ideal candidate for a replacement, she joked that “if it was a good job, they’d never have given it to a woman. ‘She’s a lawyer, what does she know about banking?’ ”
What she didn’t know, she learned fast.
“I was thrown in the deep end,” she laughed, “and started swimming toward the shallow end.”
She learned quickly, and well enough that when Eastland was sold to Fleet Bank in an assisted transaction, the FDIC came calling. It had taken note of the work she accomplished at Eastland and recruited her to head up First National Bank of Vermont.
Then in 1996, she co-founded Bank Rhode Island with Malcolm G. “Kim” Chace III.
“That was another example of taking a risk,” she said. “I was employed, had built a law practice back up in the interim.”
When the Fleet Financial Group merged with Shawmut National, “I knew of the divestitures, so I phoned Kim Chace. We had a brief conversation, found we were both on the same page and that was the start of Bank Rhode Island. His financial credibility and what I knew was a winning combination, we formed a good partnership to lead the new bank.”
In 2011, after a period of 15 years during which Bank Rhode Island swelled from $450 million to $1.6 billion in assets, Sherman negotiated the sale of its holding company, Bancorp Rhode Island Inc., for $234 million in cash and stock to Brookline Bancorp. The purchase price, $48.25 per share, represented a 57 percent premium over the price of BancorpRI common stock prior to the announcement of the sale. Under terms of the deal, the bank retained its name, separate charter and local board of directors.
She was sitting pretty – but not for long.
In January of this year, Judge John J. McConnell Jr., the federal judge responsible for handling hundreds of cases regarding mortgage-servicing and foreclosure practices, appointed her as a special master. The job means bringing together borrowers and lenders to negotiate settlements and help resolve the Rhode Island mortgage-foreclosure crisis: no small task. She welcomes the challenge, as she has in the past. “The foreclosure mess is a millstone around the neck of the economy, nationally and locally,” she said. “Until it’s [fixed], we won’t have the robust growth we’d like to see. This is a new model. I’m very excited about it and I hope to make a difference.”
She remains busy but also remains committed to her civic causes as well, they being many and varied. She is chairman of the board of trustees at the Rhode Island School of Design, and also serves on the board of Crossroads Rhode Island, the state’s largest nonprofit agency serving the homeless population.
“There are things you do because they are the right things to do,” Sherman said. “At Crossroads, where they really needed strength on their board, they had a really terrific executive director who looked at me and said, ‘Merrill, these are the people you’ve been ignoring all your life.’ ”
“She was right,” Sherman said. “It was a punch in the gut, and I knew I had to help.”
She has served many other agencies, including the Providence Foundation, the Rhode Island Public Expenditure Council, Johnson & Wales University and the Trinity Repertory Co.
Over the years, she’s chaired three fundraising luncheons for Women & Infants Hospital, helping to raise more than $900,000.
If not for business, she said she’d probably devote 90 percent of her time to civic and charitable efforts.
“You meet people and get out in the world,” she said. “That goes back to when I was a lawyer, many clients I had I also saw socially. It’s not a bright line with me, the ‘at work’ and ‘not at work’ line. For me, it’s a fuller way of looking at how you spend your time.”
Fixing things, as she has her whole working life, is just what she does, she said, adding “if you’re a lawyer and your clients come to you, it’s not because they’re throwing a party. They have a problem. I always welcomed problems because otherwise, I’d have nothing to do.
“I never shied away from an issue,” Sherman said. “I’ve never seen anything that was broken so bad it can’t be fixed.” •

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