Meet new ICBA chairman Scott Heitkamp

Whether it’s embracing technological change or serving the community,
Scott Heitkamp, ICBA’s incoming chairman, is all in

By Kelly Pike

Five years ago, if you asked Scott Heitkamp what he did for a living, he’d tell you he was a banker—but the term has since lost its meaning. Today, everyone from Wall Street and megabanks to fintech firms and the credit union down the street lays claim to the title, and the truest kinds of bankers can get lost in the shuffle.

That’s why Heitkamp, president and CEO of the $220 million-asset ValueBank Texas, now specifies that he’s a community banker. That single word draws a dramatic distinction.

“The difference between community banking and megabanks is resonating with people,” says the second-generation community banker from Corpus Christi. “The challenge is how we differentiate our banks—how we thought about banking in the past, and how we think about the future of community banking.”

It’s a message Heitkamp will share as he takes the helm as ICBA chairman. He begins his one-year term as ICBA’s top volunteer executive and community banking’s national ambassador at the end of this month’s ICBA Community Banking LIVE national convention in San Antonio.

The chairmanship will keep him away from his bank at a critical time, but technology and communication will keep him connected. Corpus Christi, a city of 320,000 in south Texas, is full of opportunity. Home to the country’s fifth largest port, an Army Depot and Naval Air Station, refineries, the fastest-growing state college in Texas and a strong tourism industry, the city holds a bright future for banking. The bank’s customers have included everyone from ostrich farmers and cupcake shops to iron and steel companies. The nine-branch bank also has two newer branches in suburban Houston.

Community matters—Opposite page: Heitkamp is a member of the board at the Texas State Aquarium (pictured, center, with its president and CEO, Tom Schmid, in front of the new $60 million expansion). Heitkamp also helped bring the Corpus Christi Hooks, a double-A minor league baseball team, to the area (pictured, bottom, with Ken Schrom, ValueBank Texas advisory director and Hooks president).

Competition is fierce, though, making every decision strategic. Consider ValueBank’s core-processing contract, which is set to expire at the end of the year. Heitkamp is working with a consultant, studying systems and trends in his quest to find a processor that can increase efficiency, keep customer data safe in an increasingly cloud-based environment, and provide the flexibility to accommodate innovative payment developments.

“I think technology investment is going to be something we need to be nimble with. It’s going to change the way we’ve done business.”
—Scott Heitkamp

Creating value
It’s not the first time ValueBank has adapted to keep up with change. The bank was founded as the Texas State Bank in 1967, changing its name to the International Bank of Corpus Christi in 1973 to capitalize on the growing Port of Corpus Christi. Yet by the late 1980s, shortly after Heitkamp’s father acquired the bank, branch banking opened up in Texas, bringing new banks to town, including one with a similar name. Confused customers often thought they were banking with the Heitkamps but weren’t. Meanwhile, international business was slow, so in 1998, Heitkamp, then president, and his team made the strategic decision to rebrand as ValueBank Texas.

“Value equals worth, and so our niche is to build people’s net worth,” he says. “If they believe in it, we can make it happen. That’s the fun about being a community bank.”

But value doesn’t just appear. To get something out, you have to put something in. Or as famous Texas banker Chuck Doyle told Heitkamp, “No deposit, no return.”
Fortunately, Heitkamp has vast expertise to draw on.

“He’s probably one of the most proficient banking types, really trying to understand all aspects of the business,” says Chris Williston, CEO and president of the Independent Bankers Association of Texas (IBAT). “He has a grasp for not only what it takes to lead an institution of his size; he can get into the minutia and weeds to make a decision.”

Some of this is instinct, though much of it comes from decades of experience and industry involvement. Heitkamp joined ICBA in the early 1990s, regularly attending the Washington Policy Summit and ICBA Community Banking LIVE while serving on numerous committees, including turns as chair of ICBPAC, ICBA’s nonpartisan political action committee; membership/marketing; and the federal delegate board. He had a similar trajectory with IBAT, coming up through IBAT’s Young Bankers Division (now known as the Leadership Division) and serving on many of the association’s subsidiary boards and the board of directors before becoming IBAT chairman in 2011.

Beyond technical knowledge, these roles have helped him form deep and lasting bonds with fellow community bankers. Cynthia Blankenship, former ICBA chairman and vice chairman and CFO of $452 million-asset Bank of the West in Grapevine, Texas, has known Heitkamp since his days with IBAT’s Young Bankers Division and often traveled to ICBA events with him. Heitkamp’s insights and trustworthiness have made him a valuable sounding board for Blankenship over the years, she says.

“He has strong opinions but is also a very good listener,” says Blankenship, who describes Heitkamp as a leader who builds consensus. “He absorbs all the details before coming to a well-thought-out, rational final decision.”

Born to bank
Heitkamp’s first glimpse of banking came as a child during visits to ValueBank—at the time called Texas State Bank—with his father’s friend and construction company partner. Something about banking fascinated him, and he never looked back.

“There was no ‘Plan B,’” says the Texas Tech grad, who joined the family bank in 1987 and became president in 1995 and CEO in 2000.

Now he’s tasked with creating the same lure for young employees and customers—showing millennials that ValueBank offers the same opportunities and technology that large banks do but in a way that’s personal, dependable and genuinely committed to the community.

For example, the bank’s marketing team has successfully gone after customers of a rival bank branch that closed by using geofencing, a mobile-based technology that allows the bank to send messages to smartphones in a defined geographic area. The bank has successfully used this approach once and is exploring further implementation of the technology. It’s an exciting approach for a gadget guy whose wife, Carrie, calls him by the nickname “Hi-Tech.”

Attention to detail is another one of his strong points, something Williston first noticed when Heitkamp began serving on IBAT’s subsidiary boards and evaluating vendors’ technical operations to decide which ones should earn the association’s endorsement. Heitkamp was integral in developing the association’s due diligence approach for evaluating vendors—a template that is still used today.

“He really can get down into the weeds to know where we need to go as an industry,” Williston says. “He’s insightful into what community banks will need to be successful in the future.”

Tenacious advocate

While technology remains a concern, ValueBank’s largest competitor is a persistent community bank foe: a federal credit union. It’s the fastest-growing financial institution in Corpus Christi, using its tax-exempt status and loose regulatory oversight to reach beyond its intended purpose.

“We’ve been the good guys helping the community, but we don’t go out and wave the flag and banner about what we do for the community,” Heitkamp says, lauding ICBA’s efforts to stop credit unions from exceeding commercial lending limits set by Congress. “We’re getting taken advantage of by Congress and the credit unions. We’re not playing with a level playing field.”

In response to the competition, Heitkamp has spent the past few years building his management team and divvying up his responsibilities to ensure both he and his team prioritize advocacy.

“Scott has tried to bring in a management team that’s more progressive to take the bank to the proverbial next level—be a little more aggressive,” says Seth Watts, ValueBank CFO and executive vice president, who was the first in a string of strategic hires over the past four years.

It’s been a challenge, Heitkamp admits. It takes new hires time to acclimate, but bringing up younger people through succession planning is a vital step to prevent mergers with other banks in the future. It’s an investment in the bank’s and the industry’s future—one he encourages other community banks to take.

“Leaders now are having to go out and change habits and advocate for the industry and have other parts of
management run day-to-day operations,” he says.

Credit unions should be on notice, because Heitkamp comes to win. Williston describes him as “the most competitive sucker I’ve met in my life” and “absolutely tenacious”—both in banking and on the golf course. Yet he keeps the competition friendly and remains the consummate Texas gentleman, peers say.

“We don’t go out and wave the flag and banner about what we do for the community.”
—Scott Heitkamp

Heitkamp applies the same determination to ICBA and ICBPAC. As former chair of ICBPAC, he has asked thousands of community bankers and directors to follow his lead and protect the value of their franchises by helping ICBA support federal candidates who support the industry.

But relationships are just as important, and Heitkamp helps people build them.
“If community bankers want to have an opportunity to get involved, then Scott is really one to try to give everyone an opportunity to contribute,” says Blankenship.
It’s that inclusiveness that will be critical in the years ahead as community banks continue to marshal their resources to remain strong, competitive and profitable.

All in the family—Scott Heitkamp with his father, Harlan, whose late-1980s acquisition, the International Bank of Corpus Christi, became ValueBank Texas.

“We have technology issues. We have millennial issues. We have consolidations. At the end of the day, when we get through this period, there is hope,” Heitkamp says. “There is prosperity for community banks, and I think the banks that held on will have more value than they did today.”

The challenge is preparing for a future where modernity and convenience rule, he says. It’s a task that takes vision, but it also takes working together—and he plans to do his part as ICBA chairman.

“I think we’ll be a stronger industry with ICBA. They’re fighting our fight every day,” he says. “If we’re all pulling the same rope, we’ll end up at a better place at the end of the day

Kelly Pike is a freelance writer in Virginia.