ICBA’s Top Loan Producers: Community West Bank in California

0714_LandingTheLoans_p04_770
Martin E. Plourd, Photo by Brent Winebrenner

Martin E. Plourd, president and CEO of Community West Bank in Goleta, Calif., offers insights on how the $550 million-asset community bank has achieved its superior loan-production volumes. In a nutshell, he explains, “the secret is executing in a timely way, consistently, and exceeding the borrower’s expectations.”

Community West Bank posted a loan production performance last year of 88 percent loans to total assets, placing the bank in a tie for 41st place in this year’s 100 best overall top-producing lenders among ICBA member banks.
Easier said than done?

Plourd says community banks must hunt for genuine opportunities in their marketplaces. At 25 years old, Community West Bank has one of the largest portfolios in manufactured homes, focused on the central coast, where land values hold better than inland. Agricultural and Small Business Administration loans dovetail with a strategy for careful capital allocation through meeting credit underwriting criteria. The government lending programs in those segments drain less capital, and put a guarantee wrapper on credit.

As community banks across the country are experiencing, the recession brought a new wave of competition as some of the largest chain banks adjusted their lending tactics by targeting small business credits. “They are becoming more aggressive in our $500,000 to $1 million space,” Plourd says.

The giant nationwide chain banks are working hard trying to gobble up midsize loans, using automatic underwriting tools such as credit scoring software models to ramp up production. Some show the thin-profit, risky-credit underwriting (somewhat reminiscent of the shoddy mortgage lending that contributed to the financial crisis), which makes it challenging for community banks looking to maintain higher credit standards and profitable margins.

Yet that heightened turf rivalry also opens the door for Community West Bank to deliver higher levels of service and promote a customer relationship culture, Plourd says. The bank’s high-touch model demands frequent communications all year long, with phone calls and emails to inquire about customers’ projects. Plourd explains, “We’re legitimately concerned that the lending outcome goes as planned, but also want them to know we’re there, in case of a bump.”

Internally, Community West Bank enjoys another advantage, being small enough to break down independent silos and bureaucratic kingdoms within. Share of wallet is inherent in the cultural strategy, which means cross-selling between, say, a commercial loan and the mortgage teams. Two years ago, shortly after joining the bank, Plourd established a monthly leadership committee, where senior managers convene to discuss how to complement each others’ business objectives. But the bank’s real focus remains on execution, to ensure everyone shares the same mindset, “to put on the highest quality assets at the best price, in the most judicious manner.”