Travillian Group recently hosted a conversation with two industry luminaries: John Maxfield, Founder of Maxfield on Banks and Senior Banking Specialist for The Motley Fool, and Jim Reuter, member of the Board of Directors for FirstBank in Colorado. Hosted by Travillian’s Head of Banking and Fintech, Brian Love, the discussion delved into career beginnings, professional journeys, and insights into the banking industry.
The Role of a Bank CEO: Insights from Jim Reuter
Maxfield praised Reuter by comparing him to Richard Davis, former U.S. Bank CEO. “When you look at the way that Jim Reuter stepped away from his CEO job, it is the exact same way that Richard Davis stepped away from his position … at the exact right time,” Maxfield notes. He highlighted the difficulty of stepping down as a CEO, emphasizing the importance of fiduciary duty and the willingness to do the right thing.
Reuter, humbly accepting the comparison, shared his leadership journey. “I was the CEO of FirstBank in Colorado. We’re about a $28-billion bank, privately held and grown organically. When I started 37 years ago, we were less than $1 billion. And today, we’re $28 billion. It was all one customer and one branch at a time.” He reflected on his tenure, saying, “CEO is the weirdest job. It’s like the conductor of a symphony. You don’t make a single sound, but you’re on the album cover. It’s the team that makes the sound.”
Building a Banking Career at FirstBank
Reuter started his career as a management trainee in Palm Springs/Palm Desert. “I was sitting in a finance class at Luther College in Decorah, Iowa, complaining about winter. And the sister of the president of FirstBank of Palm Desert said, ‘Well, you should send my brother a letter and see if they’re looking for somebody.’ And I did. That’s how I got hired and started there.”
He requested a transfer to Colorado after 18 months, asking to work anywhere but the headquarters to stay close to customers. Despite being placed at the headquarters, he found it beneficial.
Reuter played a key role in bringing the FirstBank debit card/ATM processing in-house and connecting directly with Visa, making the bank one of the top debit card issuers in the U.S. He rotated through various roles and departments, never doing the same job for more than three to five years, which he found both fun and educational.
FirstBank’s Rise in ROA During the 2008–2009 Financial Crisis
Maxfield highlighted Reuter’s leadership during challenging times, particularly during the 2008–2009 financial crisis. FirstBank’s rise in ROA during this period showcased Reuter’s skills. Reuter’s foresight in anticipating liquidity concerns and preemptively selling bonds, even at a loss, prevented more significant losses for the bank.
Maxfield emphasized Reuter’s lack of hubris, exemplified by his choice of a rather utilitarian office when much plusher suites with better views of the Rocky Mountains were available.
Maxfield characterized the less-flashy selection as a sign of Reuter’s humility, which he said “…tells you everything you need to know” about him.
The Importance of Leadership and Innovation
Love steered the conversation toward Reuter’s ability to influence others and make decisions like leaving the organization as promised. Reuter believed that companies grow better with leadership changes every 5–10 years and likened it to professional sports teams not keeping the same head coach or quarterback forever.
Maxfield praised Reuter’s determination and grit, citing his ability to navigate a board with three former CEOs. Reuter emphasized the importance of paying attention in meetings and leading with inquiry. “People say I read a room well. I don’t read a room well. I sit back and allow the room to be read.”
Discussing the need for innovation, Maxfield notes that FirstBank, despite its conservative business model, was among the first to adopt Zelle, a digital payments network. Reuter attributed this to curiosity and a willingness to meet customer needs.
“We run hotels for money. Restaurants with money. So, I study those industries a lot,” he said. The comparison was made to underscore the importance of conducting a bank’s business with a similar customer-service focus as the hospitality industry offers its guests.
FirstBank’s Strategy for Training the Next Generation
Reuter has been with FirstBank long enough to see significant changes in hiring and training. Initially, FirstBank struggled to hire experienced bankers, so they started hiring management trainees right out of college. Today, FirstBank hires 30–50 management trainees annually, retaining about half over the following 12 quarters. These trainees rotate through various roles, gaining a broad perspective of the bank.
Reuter highlighted the importance of being a generalist, citing the book Range by David Epstein, which argues that generalists outperform specialists. “The more you’ve worked in different parts of the bank, you have a much better view. And then you become a senior leader of the company.”
Recommended Reading by Maxfield and Reuter
The conversation concluded with a discussion on influential books.
John Maxfield’s Recommended Reads
How to Win Friends and Influence People by Dale Carnegie
- Maxfield is particularly fond of the book’s assertion that “a conversation is never about you; it’s about the person you’re having conversation with. That makes every conversation an opportunity to make them feel good about who they are.”
Man’s Search for Meaning by Viktor Frankl
- “Frankle survived the Theresienstadt Ghetto, a World War II concentration camp in German-occupied Czechoslovakia,” Maxfield explains. “His whole family was slaughtered, but Frankle managed to avoid execution and eventually made it to the U.S.”
”His point,” Maxfield explained, “is that people get to choose how they live and how they think about life.”
“We all run around with very rich people. A lot of these people, even though they’re incredibly rich, are quite miserable as human beings.”
“And yet,” he continued, “you have people in horrible situations who are capable of being quite happy.”
“Frankl’s point is that happiness is less a condition of your external environment and more a condition of how you look at life.”
“And if somebody is saying that — somebody who’s been through a concentration camp — doesn’t have credibility to make that observation, I don’t know who does,” Maxfield concluded.
Jim Reuter’s Recommended Reads
It’s On Me by Sarah Kuburic
- Reuter characterizes it as “…a psychology book about making decisions and control, and how not making decisions is the same as making them.”
Learning to Love Midlife by Chip Conley
- “It’s a good book [about] human psychology and knowing your values and what you want to do and what you want to leave this world,” the former FirstBank CEO summarizes.
This is just a snippet of the amazing convo between Jim Reuter, John Maxfield, and Brian Love. Enjoy the full discussion at travilliannext.com.
