Large-bank veteran leverages experience to set community bank on path to success

Northwestern Financial Review, Jan 1-Jan 14, 2004 by Hilgert, Jackie

As he explains why tellers have the toughest job in the bank, you sense Pat Bradley understands their issues better than most bank presidents. And he probably does; Bradley started his banking career behind the teller line. After two decades spent rising through the ranks at First Bank System, later U.S. Bank, Bradley is now in the unlikely - and enviable - position leading Highland Bank, a $350 million independent bank in St. Paul, Minn., into contention as the institution of choice for Twin Cities' retail and business customers.

The universe at Highland Bank, with eight locations, is quite a bit smaller than Bradley had become accustomed. When Firstar acquired U.S. Bank, Bradley was regional manager overseeing the retail banking operations of 300 branches in seven states. That position was the sixth rung up the management ladder for Bradley. But the Firstar/ U.S. Bank deal left Bradley without a compelling reason to keep climbing. Firstar offered Bradley a position as sales support for all non-metro banks in its system. "The job [they offered] would have pulled me further away from the customer," Bradley said.

It wasn't what the Zumbrota, Minn., native wanted after 22 years of hands-on banking, so in March 2001, he walked away. "I committed myself to a year off to examine my options," Bradley said. He wasn't sure if he'd ever work in banking again.

Six months later he was in negotiations with Rick Wall, Highland Bank's CEO, who approached Bradley about assuming the presidency. "It takes a certain level of management experience to take a bank and grow it the way we are interested in growing," Wall said. "Pat had the experience with a large organization and he has a great way with people."

Transitioning to a community bank was "interesting" Bradley said. He wasn't interested in change for change's sake, but the bank hadn't seen tangible asset growth despite regular increases in profits and the addition of branches, so change was inevitable.

"Having been on the inside of a large bank, I knew the opportunities that existed for us," Bradley said. "I know large banks are volume driven so we had to be relationship driven." The bank also needed to nurture a sales culture to meet its strategic plan for growth; developing sales discipline could be found atop the list of strengths on Bradley's resume.

Bradley tapped into experience he'd gained in the mid 1990s when he was in charge of retail and investment sales and operations for First Bank. "Product and process knowledge is key for our employees," Bradley said. Highland has training programs for all staff members and has made sales tenacity such a priority; the bank tests for sales competency during the hiring process. "We invest in our people, offering them career pathing," he added. The investment has curbed what could have been the bank's greatest hurdle to success - employee turnover.

"Our staff is made up of very professional people," Bradley boasted. Staff competence was the differentiating point Bradley keyed on when pressed about the competition High-land Bank faces from Great Northern Bank in St. Michael, Minn., the fast-growing town 35 miles northwest of Minneapolis where Highland Bank is chartered.

"We have good competition in St. Michael. But we also have loyal customers and we think, because we do our own data processing, we can stay ahead of them [Great Northern] through outstanding customer service."

Highland also operates a branch in downtown Minneapolis where the giants, Wells Fargo & Co. and Bradley's former employer, U.S. Bank, cast long shadows over the concrete landscape. Bradley is quick to defend this unlikely location. "There are a lot of professionals (attorneys, architects, doctors) who are interested in relationship banking," he said. Highland Bank offers small and mid-size businesses a stable banking relationship, he said. "They want a banker who takes the time to get to know their business and anticipate their needs."

Serving small and mid-size businesses was a key area of opportunity Bradley identified early on. Highland Bank also needed to build the SBA lending program. The bank hired Kim Storey, formerly of the cross-town small-business lending maverick Riverside Bank, and Andrew Dahlen, a colleague from Bradley's U.S. Bank days, to bolster the commercial side of the bank's portfolio. The strategy is working; Highland Bank was recently designated a "certified" lender for the Small Business Administration.

It was late summer of 2001 when Bradley was first approached about a job with Highland Bank; he was at the helm before the first snowfall. During the same stretch of weeks, two of Highland Bank's stalwart peers, Richfield Bank & Trust and Signal Bank, vanished from the market as acquisition-fever swept through the Twin Cities.

Bradley regarded the acquisition of like banks as irrelevant to Highland Bank's future independence. That's a powerful affirmation as the staff finished commemorating the bank's 60th year in business. "Very few banks our size haven't been approached about selling," Bradley said. Highland Bank has a plan in place, he added, that will have the bank increasing assets, employees and locations by 2005.