What’s in a Name? Plenty
Since entering the market in 2017 through the acquisition of Merchants Bank and its branch in Springfield’s Tower Square, Community Bank, N.A. has been working to build on its foundation in this region. It brings to the highly competitive local banking landscape both considerable size and an operating mindset commensurate with the name on the letterhead.
Mark Tryniski acknowledges that it sounds illogical that a financial-services institution with $12 billion in assets and more than 230 branches could call itself a community bank — let alone call itself Community Bank, N.A.
But Tryniski, president and CEO of the Syracuse, N.Y.-based institution, said ‘Community Bank’ represents more than a name — and one that fits. Indeed, it’s more like an attitude.
“As our name suggests, we’re a community bank — that’s how we’ve always operated,” he explained. “And when you put the name ‘Community’ on your bank, you’d better function as a community bank — and we do.
“There is such a thing as a community-bank model,” he continued. “You push authority down to people in the branches, as opposed to the big-bank model, where you walk in the door looking for a home-equity loan and they put you on the phone with a 1-800 number and someone working in another country. Community banks don’t do that.”
“When you put the name ‘Community’ on your bank, you’d better function as a community bank — and we do.”
This operating mindset has enabled the institution to grow considerably over the past several years and into a number of different markets, including Springfield, accomplished through the acquisition in 2017 of Merchants Bank, which had previously acquired NUVO Bank, which operated a single branch within the 413 within a large footprint in Tower Square.
Since putting its name over the door on Main Street, Community Bank, N.A. has downsized that space considerably, while simultaneously working to establish itself and broaden its horizons within this market.
It has done so by essentially living up to the name over the door, said both Tryniski and Mike Buckmaster, vice president of Commercial Lending. They both said the institution possesses the formula that’s required to succeed today — a community-bank feel, but a large size that is necessary in a changing, quite challenging financial-services marketplace today.
“I think that, over a period of time, the market has accepted the fact, to a degree, that this is a consolidating industry,” said Buckmaster, who has logged more than 30 years in the banking industry, locally and in the U.K., and has carried business cards bearing the logos of NUVO and Merchants Bank, among others. “The differentiating factor tends to be the commercial banker, and if the commercial banker can continue to deliver in terms of service and business development, there tends to be a good degree of customer loyalty toward the banker, even through various acquisitions.”
That lengthy explanation helps explain why the Springfield facility has been able to enjoy steady growth in its portfolio even as the name on the wall of Tower Square has changed several times this decade.
Tryniski agreed, but said the combination of size and small-bank attitude is becoming ever more important as the consolidation movement continues without any signs of slowing down.
“I’ve been around the banking industry for a little more than 30 years, and there’s been a dramatic change in the banking landscape, mostly centered around consolidation,” he explained. “When I started, in the ’80s, there were 16,000 or 18,000 banks; now, there are roughly 6,000 banks.
“And I think the trend toward consolidation will continue because of efficiencies that can be garnered by scale and technology,” he went on. “The bigger you get, the more you can justify investments in technology to give you more efficiency. It’s hard for the smaller banks — you have to really be efficient and disciplined.”
Overall, Community Bank will look to get bigger still, and is looking at opportunities to expand within the Western Mass. and Connecticut markets, said Tryniski, but “haven’t found what the right opportunity is yet,” as he put it. Elaborating, he said growth for this institution will continue to come as it has historically, through a mix of organic growth and acquisition, with more of the latter than the former, especially in areas with slow or no growth but more than enough competition, and Western Mass. certainly fits that category.
In such markets, growth can come only by taking market share from other institutions, he went on, adding that this is generally difficult to do. Community Bank has had a good amount of success doing just that, however, because of that aforementioned enviable combination of large size and smaller-bank feel.
For this issue and its focus on banking and financial services, BusinessWest talked at length with Tryniski and Buckmaster about how Community Bank, N.A. has firmly established its presence in the local market and how it intends to secure additional market share and perhaps expand its footprint in the 413.
By All Accounts
Since acquiring Merchants, and therefore all its branches, Tryniski has visited Springfield on several occasions as part of his efforts to fully understand the broad geographic area served by the institution — one that stretches from the Northern Kingdom in Vermont to the Southwest corner of New York to the Lehigh Valley in Pennsylvania — and meet both team members and customers.
“We spend a lot of time on the road,” he said of the management team at the bank, adding that, when he does visit Springfield, or any other community served by the bank, he makes a point of learning as much about the region as he can.
In the City of Homes, he’s become familiar with some of the players within the business community, has found a few restaurants he likes, and is both impressed with and encouraged by the high level of energy he’s seeing in the central business district.
He said there are a great many similarities between Springfield and Syracuse, and in some ways, that has helped him understand the dynamics of not only the communities themselves, but the banking environment here.
“They’re remarkably similar, actually,” he said. “They have the same population, they have an industrial history, they have a stable-but-not-growing population, there’s a lot of education, the downtowns look very similar … they’re very much alike. Springfield feels to me like Syracuse.”
From a banking perspective, that means a community that, as he said, is experiencing comparatively little growth, population-wise and new-business-wise, and has a crowded field of competitors for financial-services products — banks and non-banks alike.
In this environment, operating with that community-bank model — but with roughly $3 billion in assets behind the institution — is what amounts to a competitive advantage — a large competitive advantage, said Tryniski.
SEE: List of Banks
“We tell our branch managers that we want them to be the president of the bank in their town,” he explained. “And we give them the authority to do that; we give them lending authority and authority around charitable contributions, fee waivers, fee adjustments, things like that. We try to vest as much authority in our branch managers locally as we can, and let them make decisions about their customers and their market.
“We probably have more of a community-bank business model than most community banks,” he went on, “because most don’t operate like that.”
However, in this market, there are still a large number of community banks — more than in many other markets — and this simple math requires that small-bank mindset. Meanwhile, the field of competitors continues to change and grow, thanks to technology, which has brought many non-bank players into the mix, said Tryniski.
“We compete now with all sorts of non-bank competitors on the lending side — for everything,” he told BusinessWest. “Whether it’s personal loans, business loans, car loans … it doesn’t matter what kind of loan you’re making, you’re competing against a multitude of other, non-banking enterprises. And the same is true on the deposit side as well.”
Buckmaster agreed, noting that, on the commercial-lending side, with all that competition, as well as all that consolidation, having a local address is not the same thing as having people who know the local market and have worked within it for years, if not decades.
“All that competition puts the emphasis very much on the banker and being able to provide the service and support growth going forward as clients need,” he said, adding that Community Bank is large and stable, and thus able to provide commercial-banking products of all sizes, including dollar amounts beyond the scope of many of the smaller community banks that populate the region.
The sweet spot for the bank, though, is loans between $1 million and $3.5 million, he said, adding that the bank is able and willing to continue writing loans for small-business owners, something the very large banks seem less interested in doing so.
This flexibility has enabled the institution now known as Community Bank, N.A. to continue to serve the customers added to its portfolio when it was NUVO, he went on, adding that loans have been written for businesses across virtually all sectors and for a number of commercial real-estate acquisitions as well.
“We’ve have some customers who were initially small back eight or nine years ago who have grown into significant customers that require a significant increase in loan support going forward,” he told BusinessWest. “We’ve seen some good growth in commercial and industrial customers over that period of time, and in addition, we’ve also seen significant new dollars in different types of commercial-investment real estate, whether it be locally in Western Mass. or further afield.”
Worthy of Interest
Returning to some of those numbers mentioned earlier — the 230 branches and current status as the 125th-largest bank in the country — Tryniski said they certainly make Community Bank, N.A. sound big. And it is.
“But we’re a lot close to the smallest bank in the country than we are to the biggest, even though the numbers say we’re one of the biggest,” he noted, adding that, in today’s banking climate, it’s not how big a bank looks on paper that matters, but how big it acts in the markets it serves.
And with that as the benchmark, this institution does indeed live up to the words on its stationary and over those 230-odd doors.
George O’Brien can be reached at [email protected]
Rolling Out the Welcome Mat
There’s more than one way to look at a number. That’s especially true when it comes to hotel occupancy rates.
Take Greater Springfield’s occupancy rates through the last six months of 2018. At almost 67%, they’re 5% higher than they were over the same period in 2017.
That’s good news on its own, but especially positive when considering the capacity added over the past 18 months, from Holiday Inn Express on State Street in Springfield to Fairfield Inn & Suites in Holyoke; from Tru by Hilton in Chicopee to, of course, the hotel at MGM Springfield, the resort casino which is perhaps the region’s top tourism development in decades.
“We’ve definitely seen growth,” said Wydra, president of the Greater Springfield Convention & Visitors Bureau (GSCVB), adding that the average daily room rate also rose by $3 over that time frame.
“The fact that we added inventory and we’re still able to grow rate and grow occupancy is a really good thing,” she noted. “In analyzing that, a lot of it is the MGM factor, and it’s conservative because MGM didn’t open until the end of August. We don’t even have a full year’s picture of them being fully operational, but in just those four months, it’s helped.
“And by charging a higher rate for their rooms,” she added, “it allows everyone else in the marketplace to go up a little bit, which from our perspective is really good because, before they got here, we weren’t moving that needle.”
“The fact that we added inventory and we’re still able to grow rate and grow occupancy is a really good thing. In analyzing that, a lot of it is the MGM factor, and it’s conservative because MGM didn’t open until the end of August. We don’t even have a full year’s picture of them being fully operational, but in just those four months, it’s helped.”
But MGM is just one factor in drawing visitors to the region and increasing demand for hotel rooms. In fact, the relationship between hotels, tourist attractions, convention business, leisure travel, and a host of economic benefits that follow in wake of all that is the result of a coordinated dance between the various players — a dance that has continues to pick up the tempo.
Go for the Juggler
Greater Springfield still runs slightly below the national average in hotel occupancy rate — 63.6%, to be exact, compared to 66.2% nationally. And it doesn’t compare to a city like Boston, which hovers around 79% occupancy.
“Remember, hotels serve the leisure traveler, conventions, bus tours, corporate travel, and also having businesses surrounding you. Boston has growth from the companies being built. It’s not all tourism. It’s business travel as well,” Wydra said. “There’s clearly corporate travel in our area too, probably not to the extent that a major city like Boston has. We’re more focused on other things: the conventions, the leisure, the bus tours, sports.”
The GSCVB has, indeed, seen an uptick in conventions in recent years, and believes MGM is just one more perk to draw in convention groups looking for a vibrant scene, which Western Mass. offers, especially during the summer.
“You’ll see that with some of the national conventions we work with,” said Alicia Szenda, director of Sales for the GSVCB. “We’ve hosted the National Square Dance Convention, the International Jugglers Association … those events take place in the summer, and people participate in them not for their job, but for their leisure activities, their hobbies, so they look forward to that week every summer, and that’s their family vacation.
“So they’re here,” she went on, “and they’re participating in educational seminars and shows and the dancing or whatever it is, but they’re also going to Six Flags, they’re going to Yankee Candle, they’re going to the museums, and doing some sightseeing while they’re here. A lot of the conventions we work with build that social component into their event schedules, so people get to experience the area they’re in. So the more attractions we have, the more variety of hotels, the more attractive we are to different groups.”
And a dynamic hotel scene is, indeed, a key element, which is Wydra is happy to see new names on the scene and planned renovations as well, such as Tower Square Hotel’s plan to return the Marriott name to its complex.
“I think one of the good things about new properties coming into the market is it keeps everybody in a position of having to keep up,” she said. “You’ve got to be reinvesting in your property and making changes; it’s survival of the fittest.”
As part of her role in recruiting conventions to the region and guiding them through the process (more on that later), Szenda also works directly with hotels, asking them to quote rates and block off a certain inventory of rooms, sometimes three years out.
“What the hotels give back depends on where they’re located, what other business they have, and whether they want to roll the dice and let other hotels get the group business,” Wydra said. “They might say, ‘I don’t want that. I’m going to roll the dice and see if I get the leisure visitor.’ They can charge leisure travelers a higher rate — because Alicia’s going to beat them up and say, ‘I want the best rate I can get for my group.’”
Besides attractive hotel rates, the GSCVB might find local ties to entice a convention group, Wydra said, giving the hypothetical example of bringing in a convention of railroad hobby enthusiasts and trying to set up a tour of the CRRC rail-car manufacturing plant in Springfield. “We try to tie in local business with the groups that we have.”
But there’s far more to the equation, Szenda noted.
“Some groups come to me and say, ‘this is everything I need.’ But a lot of groups I work with don’t have that. It might be their turn to host, and they’ve never planned a national convention before. I sit with them and go through everything they need. Then I send those leads out to our members. Depending on what they need for space, the lead could go to Eastern States, or the Mullins Center, or the MassMutual Center, all three.”
Then she gets to work finding the aforementioned local connections, setting up reasonably priced hotel options, and assembling tourism information about the region.
“Really, it’s the destination a lot of times that’s going to sell that piece of business,” Szenda said, “because you’re trying to convince that one person to bring thousands of people here. They have to make sure each person has something to do that interests them. And, once we win that piece of business, we continue to hold their hand through the process.”
“I think one of the good things about new properties coming into the market is it keeps everybody in a position of having to keep up.”
Part of that is a hospitality program that many similar-sized cities don’t offer, she said, which includes everything from airport pickups and hotel greeters to downtown maps and goodie bags.
“A lot of the business we get is repeat business because we’ve done a good job from the very beginning — meeting them, listening to what they need, giving them what they need, and holding their hand until the event occurs,” Wydra said. “And while the event occurs, we don’t disappear. Even with groups we’ve hosted for years, we never want to rest on our laurels and say, ‘well, we’ve got them.’ It’s a very competitive business, so we want them to know how much we appreciate they’ve selected Western Mass.”
And it’s not just repeat business from that convention group at stake, she added. Oftentimes family members tag along, extending the trip with some family time.
“You never know which of those participants might want to come back,” Szenda said. “They might belong to another association and want to bring a group here or come back with the family. A lot of people to do that.”
It’s always interesting to see what impresses event planners, Wydra said. Once, Springfield was competing with a city in New Hampshire, and when the group heard that welcome signs would be hung downtown, it was a game changer. The planner had previously walked the streets of unfamiliar downtowns, getting permission as she went to tape up handmade signs.
“She didn’t want to do that; she had a day job,” Wydra said. “The minute we take that out of their hands, make it easy, the results are often good for us.
“We work hard to get the groups, so at the very least we want to keep them,” she went on. “We want repeat business. Alicia loves when someone signs a multi-year contract, and we can count on them for years to come.”
What’s in a Name?
If Tower Square does bring back the Marriott name — and makes the upgrades required to do so — that will be another note of progress for the region’s expanding hotel scene, Wydra said.
“Brands are important,” she noted. “I think a brand kind of promises something, if the property does it right. People know what they’re going to get. They know they’re going to get a certain style room, they’re going to get a free breakfast, affinity programs, whatever it is they want.”
Greater Springfield is a brand of sorts, too, even though it can be a tough sell during the winter, which is why events like the recent AHL All-Star weekend are so desirable, driving room nights during a challenging time of the year for the hospitality industry.
But there’s still plenty of room for hotels to flourish, Szenda said, as evidenced by the challenge of cobbling together enough rooms when multiple conventions and event planners want to swoop in during the same weekend — typically between spring and fall.
“During the summer months, we do quite well on weekends, with Six Flags and other activities,” Wydra said. “It’s always midweek that we’re trying to find business, and especially in the winter.”
But a rising tourism brand, buoyed most recently by MGM Springfield — and increased convention volume, much of which promises to become repeat business — is certainly changing the demand picture for the better.
Joseph Bednar can be reached at [email protected]