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Bank customers are making fewer regular visits to their local branches, which aren't getting cheaper for banks to maintain — but bankers are sharply divided on how to fix their branch problems.
March 12
When Umpqua Bank Chief Executive Ray Davis tells customers that he answers his own phone, he means it.
In nearly all of its branches Umpqua has set up phones that provide customers with a direct line to Davis' office in Portland, Ore. Often they will call to praise a rank-and-file employee or just to see if Davis really picks up, but occasionally he will hear from customers who feel their questions or concerns are not being adequately addressed by branch staff.
"Every now and then banks mess up. Umpqua is no exception," Davis says. He believes that the worst thing a CEO can do is hide from customers and the in-branch hot line helps Davis get out in front of a potential problem. "I can't fix it if I don't know about it," he says.
The $11.6 billion-asset Umpqua is believed to be the only large or regional bank in the country offering customers such immediate access to the chief decision maker — no surprise considering its business model. Umpqua has been on the cutting edge of retail innovation for years — it pioneered the coffee bar concept and offers such activities as yoga classes and video game classes to draw in potential customers — and the hot line to Davis is just another touch that helps Umpqua distinguish itself from its competitors, says Mary Beth Sullivan, a managing partner at Capital Performance Group.
The phone service is not necessarily new for Umpqua, but Sullivan says it is another arrow in the bank's quiver that could serve it well as it moves into markets where it is less well known. Umpqua
"It's hard to stand out, and they've been entering some competitive markets," Sullivan says.
Davis says he receives only handful of calls a month and most are from customers who want to heap praise on an Umpqua employee. Still, Davis has addressed problems over the years as well, and he believes the bank has retained business by letting customers air their grievances "when things don't go so hot."
The telephones have even helped to bring in new business at times, Davis says. He once received a phone call from a customer who only had part of his business with Umpqua. A week later, the same customer called Davis back and said that he tried to speak with the CEO of a large bank. After more than a week of trying, the customer was only able to get through to an assistant, who told him that the CEO didn't take calls from the public. The customer subsequently moved the rest of his business to Umpqua, Davis says.
Still, it is unlikely that other large or regional banks would copy the telephones that Umpqua has in its branches, Sullivan says. In her view, Umpqua is unique in that its customers have retained access to the decision makers even as it has grown from a small local bank to the largest bank based in Oregon with nearly 200 branches in four states.
"It's harder as you get bigger," she says.
