The phrase "communication is key" is more than a platitude to James R. Black, the new president and chief executive at Citizens Community Bank — it's his management style.
Within 24 hours of taking over as CEO at the South Hill, Va., bank, Black sent out a survey to employees to get their feedback. Black, who had been the chief financial officer since May 2007, then met with employees individually to hear about their concerns.
Comments centered on culture, teamwork and communication, Black said. "It added new light to things you may not see … when you are sitting in the CFO or CEO role."
Black is now working to address these issues and prod the bank into more aggressively tackling its problems. He outlined this vision in a letter sent to shareholders - yes, more communication! — released about a month after he took the helm at the $164 million-asset bank.
Dealing with problem assets is "costly and drains the positive energy within an organization," Black says. He has pledged to charge off impaired and classified credits. Citizens Community will not sell loans as they "would be microscopic" relative to the market, and the bank then retains the possibility for recoveries, Black says.
Additionally, the bank will place its other real estate owned in liquidation and will take writedowns on the properties in the fourth quarter. Citizens Community expects to auction off properties during the first half of 2013.
This strategy takes advantage of Citizens Community's capital position and allows the bank's staff to begin focusing on areas of growth, Black said.
Citizens Community will seek to expand the products it offers, Black said. It will refocus and grow its secondary mortgage program and will soon offer a debit-card rewards program. The bank also will provide mobile banking and improve its commercial treasury services for small businesses.
The bank could begin pursuing acquisitions once it is strong enough, although Black recognizes that his bank is limited by its small size. All options would be on the table, including deals for branches, smaller institutions or niche businesses, Black says.
So far, Black says, shareholders have supported his plan. He believes in "open, honest and candid dialogue" and points to Jack Welch, a former chairman and CEO at General Electric (GE), and Welch's longtime colleague, Larry Bossidy, as businessmen who were successful and valued communication.
Even though the company is privately held, Black has pledged to "always keep in the forefront communication for shareholders, employees and other stakeholders."
"We are the small kid on the block, and that makes it hard," Black said. "But at the same time there are still opportunities out there. You have to put your organization in a position that allows you to explore those options."