Women in Banking

A bro-think remedy, a new crypto czar and a Facebook facepalm

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A BFF by any other name: Umpqua Bank’s innovation hub Pivotus rolled out a service called “BFF” that lets customers choose a banker they want to work with, “kind of like Tinder,” said Rilla Delorier, Umpqua’s chief strategy officer. The banker answers questions and solves problems through chat. "Compliance people love this because [conversations are] all retained," Delorier said. "Our data people love it because you can crawl through the conversations and pick out great information. Agents love it because they build relationships with customers and they're not sitting in a store waiting for someone to walk in. And customers feel like they have a personal concierge, like a private banker." But calling the service BFF was “a bad decision,” because the target is not millennials, she said. “We'll be renaming it to something people my age don't mind saying." Her advice – to use innovation as a way to improve customer service rather than cut costs – is part of this article titled “Innovation checklist for banks stuck in a rut.”

A prime subprime target: Women with credit scores below 700 are some of the most financially stressed people in America, according to new research. Perhaps savvy banks could look into tailoring products and services to help this group of women. They work more hours than women with higher scores (70% work full time compared with 62% of women with prime scores), are more likely to have children and elderly parents at home, and tend to be the head of their household. They also are 38% more likely than men with subprime scores to run out of money at the end of the month, which means that they also are more likely to borrow just to get by. Banks that find a way to help them achieve stability faster – perhaps through advice tailored along gender lines – could earn some outsize loyalty. The research is from the Center for the New Middle Class, an independent research arm of the online lender Elevate.

May the force be with you: U.K. banks need to change the system for awarding employee bonuses to avoid the “alpha male” advantage, the Parliament said Wednesday. Bonuses paid to women at U.K. banks averaged less than half those of men, when measured on an hourly basis, according to a Treasury committee report, which attributed the difference to the fact that the men argued “more forcefully” for higher bonuses. To avoid this disparity, banks should set objective criteria for assessing bonus pay, instead of having employees negotiate for what they receive, as is the case now, said Nicky Morgan, the committee chair.

The deciding factor: One reason so few women make their way to the top in banking is because it is mostly men deciding who gets promoted, said Anne Boden, who founded the digital-only Starling Bank in the U.K. “As long as we have the majority of promotions and appointments being made by men, it’s going to be harder for women to get through,” Boden said in an interview with the Guardian. That is a major problem for everyone (not just women), because the way to avoid another financial crisis is through diversity, and the varied perspective it brings, she argued. Her frustration with the seeming inability of banks to change for the better prompted her to start Starling, which has grown to serve more than 100,000 customers since opening in 2014. “Most people thought [launching a new bank] couldn’t be done, but I had to do it,” Boden said. “I experienced the crisis, the legacy systems and bureaucracy of the big banks. I’d experienced people trying to replace the existing system and it taking too long and costing too much. I wanted to start from scratch.” (This calls to mind Stessa Cohen’s BankThink, “Sick of the boy’s club? Start your own bank.”)

Bro-think remedy: Computers could end up thinking “like some bro culture on the West Coast” unless a diverse group of people is involved in developing artificial intelligence, said Mastercard vice chairman Ann Cairns. “There’s no point having the Internet of everything if you don’t have the Internet of everyone,” Cairns said. To get more women into STEM fields, “you’ve got to grab girls young, and tell them it’s fun.”

The SEC’s first crypto czar: Valerie Szczepanik’s new title at the Securities and Exchange Commission is associate director of the Division of Corporation Finance and the senior adviser for digital assets and innovation. Or, some say the “crypto czar” for short. Szczepanik, an SEC veteran who is now the point person in working out how securities laws should apply to cryptocurrencies and initial coin offerings, is seen by industry participants as more likely to be a good cop than a bad cop.

Role call

BBVA Compass has appointed Celie Niehaus as its chief compliance officer and has added her to its management committee. She will oversee the compliance activities for the entire bank, including retail, commercial and wealth units. Niehaus, who was previously the chief compliance officer and chief privacy officer for Capital One Retail and Direct Bank and Enterprise Services, succeeds Joe Cartee.

Catherine Keating will become CEO of BNY Mellon Wealth Management, effective July 9. She also will join BNY Mellon’s executive committee and the Investment Management leadership team. She will report directly to BNY Investment Management CEO Mitchell Harris. BNY Mellon’s wealth business had $246 billion in assets under management as of March 31. Since 2015, Keating has been the president and CEO of Commonfund, an asset manager that is a nonprofit itself and oversees $25 billion for nonprofit investors such as endowments, foundations and public pensions. Prior to that, she worked for almost two decades at JPMorgan Chase. She was selected as one of American Banker’s Most Powerful Women in 2008 and 2013.

Besides announcing that its chief investment officer, Mark Anson, would succeed Keating while retaining his current role, Commonfund said it is promoting Deborah Spalding and Kristopher Kwait to deputy chief investment officers.

TIAA has named Lori Fouché as CEO of retail and institutional financial services, effective Aug. 7. The new role is being created by combining the responsibilities of Ron Pressman, CEO of institutional financial services, and Kathie Andrade, CEO of retail financial services. Pressman is retiring while Andrade, who ranks as one of our Most Powerful Women in Finance, is leaving to pursue new opportunities. Fouché is joining TIAA from Prudential Financial.

Payday industry veteran Mary Jackson has been named CEO of a payday trade group called Online Lenders Alliance. Jackson succeeds Lisa McGreevy, who, after nine years as CEO, will transition to a role as senior adviser to the alliance. Jackson previously did communications for Cash America International.

Recent podcasts

Perfection is the enemy: Bankers don’t know how to innovate, Julieann Thurlow, the president and CEO of Reading Cooperative Bank in Massachusetts, said on the Breaking Banks podcast. Thurlow attributes this to their tendency to dismiss flawed solutions. “There’s always going to be a flaw,” she said. “We have to give ourselves permission to have flaws and then figure out how to correct.”

Talking strategy: Bank of the West CEO Nandita Bakhshi shared how she's improving the customer experience, making the bank a better place to work, and trying to foster a culture of innovation, in a recent American Banker podcast. She also stressed the importance of diversity, saying 8 of the 15 people on the executive management team are diverse, and 5 of them are women. “When we are looking to hire individuals or promote from within, the question we ask is if we have a diverse slate. Have we considered all qualified diverse or women candidates before making the promotions happen? We also hire expats and we get diversity from that perspective too,” Bakhshi said.

Stronger together: Ellevest CEO Sallie Krawcheck hates the word “empowerment.” Women don’t need to be empowered – they have plenty of power. The key is to use it in collectives, she said on Business Insider’s “Success! How I Did It” podcast. “So much of the pop-culture advice to professional women for years has told us that we, individually, can advance: ‘Ask for that raise. Take the seat at the table. You go, girl.’ … And it hasn't worked,” Krawcheck said. But recently women have been showing they can drive big changes by banding together – like the New York Times women who made the case for longer parental leave, the Nike women who exposed the bad culture at their company and the actresses who rallied against Harvey Weinstein, she said. “That isn't about empowering anybody. That's about us recognizing the power we have, the strength we have, and using it.”

Beyond Banking

Women keep winning: It was a big week for women in politics across the eight states holding primary elections on Tuesday. More than 500 women nationwide — the majority of them Democrats — are running for state or federal offices, blowing away the previous record, according to the Center for American Women and Politics. Here’s an overview of what happened in various races around the country, and here’s a detailed look at the battle for control of the House and Senate.

A notable mayoral first: London Breed has become the first African-American woman to be elected as the mayor of San Francisco, and the city now joins a handful of others run by black women, including Atlanta, Baltimore and Charlotte. Her victory on Wednesday will make San Francisco the largest U.S. city to have a female mayor. Breed portrayed her life’s trajectory — starting with an impoverished childhood in public housing — as an uplifting example to a city that is struggling with issues of income disparity.

‘Facebook dismissed my concerns because I’m “not nice” ’: So says Arjuna Capital’s Natasha Lamb, in recounting her experience at Facebook’s shareholder meeting. No executives would respond publicly when she asked about issues such as the company’s gender pay gap and its failure to address the problems of fake news, hate speech and sexism on its platforms. But she was asked to speak privately to Facebook’s Elliot Schrage, who told her that “the company was not engaging with me because I’m ‘not nice.’ ” Lamb, who wondered if Carl Icahn ever had that happen, seemed incredulous over the irony of being dismissed in a sexist way for calling out problems that are related to gender. “Not nice?” she wrote in the Financial Times. “This from a company whose chief operating officer, Sheryl Sandberg, led a campaign to empower women to speak up by banning the word bossy?”

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Chental-Song Bembry contributed to this report.

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