Bank president starts his tenure with whirlwind tour
Brad Kessel is back and he has a plan.
Kessel, the president and COO of Independent Bank Corp., returned to Grand Rapids in July after a seven-year stint with the bank in the Bay City area. He had previously spent 10 years with Independent in Grand Rapids.
“This (change) became effective in April, and we moved over here in July. It’s been going great. I’m married with three daughters and they’re all in school, so part of the challenge was getting everyone over here successfully,” he said.
Although the Bay City area was beautiful and offered plenty of positives, Kessel acknowledged that his family was disappointed to leave Grand Rapids.
“Quite frankly, this is a great market — West Michigan — for a lot of reasons. The core values of people here are so good. Being close to Lake Michigan is a big plus. And there’s a very good downtown here.”
In some respects, he said, it’s like he never left. Other times, Kessel said, he is amazed by the changes the city has undergone.
“To see all that’s happened here in the last seven years is pretty neat,” he said. “And I think that’s largely a function of the generational families here and what they’ve contributed.”
He acknowledged the Meijer, DeVos and Van Andel families, but stressed that the philanthropic nature of West Michigan doesn’t begin and end there.
“I think it goes beyond that — way beyond that,” he said. “It’s the quantity of the people that give back, not just the quality. West Michigan has a lot of people that care about West Michigan, and I think that is very evident in this community.”
In fact, Kessel said that core support of West Michigan is one of the values he hopes to nurture in Independent Bank.
One of Kessel’s first tasks as president will be to tap into that family culture and help spread it throughout the bank’s approximately 1,200 employees.
“We have 105 locations. In the next six to nine months, part of our mission is to get to all 105 and visit with our people and our customers. We want to talk about what’s happening in the community and we want to make sure (Independent is) part of that discussion. We are a part of the communities we serve, and we take that role seriously.”
Kessel has held a variety of positions with the bank, including finance, branch administration and then president and chief operating officer of what, at the time, was one of Independent’s four “affiliate” banks. The economic downturn necessitated some changes within the bank’s structure, however, and now those affiliates are all together under the Independent banner.
The economic downturn has been difficult for many in West Michigan, and the banking industry is no exception. Kessel said by 2007, the bank and its customers were beginning to feel the repercussions of high unemployment rates, frozen capital, a housing market gone south and a general malaise in the development community.
For a bank that prides itself on local connections and personal service, the turnaround was devastating. Longtime customers were losing their jobs, and their houses and businesses were threatened. People who had sat across from their bankers for years and concluded deals “on a handshake” were suddenly finding themselves upside down.
“And many who lost jobs were finding new jobs, but their pay was less. The affordable housing ratio became a real problem. We’ve had problems — significant problems — in loan portfolios. Suddenly, people just don’t have money any more. And if they don’t have money, they can’t pay their bills.”
Independent responded to the crisis early by putting together its own borrower modification program. Customers who were having financial difficulties were instructed to call the bank, and the bank pledged to work with them through the downturn.
“This took a lot of teamwork and putting aside any differences,” he said. “We had to do things differently. Of course, some people we just couldn’t help. But for most people — people who sat across the desk from us for years and years — this paid huge dividends.
“It’s been one of the hardest things we’ve had to do in the past few years, but probably one of the things I’m most proud of. We’ve kept people in their houses and kept their businesses running.”
Although the financial crisis in Michigan is far from over, Kessel said he sees a light at the end of the tunnel.
“The problem is, it just doesn’t happen as fast as we’d like. It’s not going to get fixed overnight. But it’s definitely getting better, and I’m optimistic for not only this community and state, but for our country as a whole.”
With the economy showing signs of life, Independent is gearing up for an improved future.
“We’ve got four goals to work on. One, we need to get back to making consistent profits. Two, we’ve taken a beating the last couple of years and we need to replenish our level of capital. This is the money we lend out so our customers can grow. Three, we need to pay off our TARP commitment. And finally, we’ve got to create a new banking model for this company. We’ve got to get back to community banking basics.”
Kessel said the first three goals will be completed in the “near or intermediate term,” but it’s the last goal that has him most excited.
“We have to expand our customer base by expanding our service base,” he said. “We are going to have to win customers from our competitors, and we’re going to do it with service. We spend a lot of money to educate our employees on service, and I think it’s paying off.”
Kessel pointed to two consecutive years of five-star service ratings from J.D. Power & Associates as evidence that the training is beneficial.
“We haven’t been able to invest as much in dollars over the past couple of years, so our people are giving of their time. We’ve just started tracking (volunteer) hours at the bank, and in July and August, our employees have committed 1,800 hours to helping kids and the elderly with financial literacy, identity theft training — those types of things. That’s something we can point to that differentiates us in the community.”
Kessel, who spends much of his free time watching his children’s extracurricular activities, is looking forward to becoming more involved in the West Michigan community. His financial expertise landed him on several boards in the Bay City area, ranging from foundations and charities to economic development organizations.
“I love getting involved in the community,” he said. “Frankly, I feel like I get more out of it than I give. I get to meet so many new people that I wouldn’t otherwise meet, learn about different projects that are going on locally and work as a team to accomplish a goal.”
It’s the same philosophy he wants Independent Bank to embrace. “As our communities go, we will go,” he said.