Jim Vining, the cofounder of Vining Sparks, ICBA’s exclusively endorsed broker‑dealer, shares lessons from his decades of providing investment services to community banks.
By Cheryl Winokur Munk
For Jim Vining, working with community banks has been a lifelong adventure.
Vining, age 75, is chairman emeritus of Vining Sparks, which has been ICBA’s exclusively endorsed institutional broker-dealer for nearly 30 years. Vining officially retired nine years ago after being diagnosed with cancer, but he maintains close ties to the Memphis, Tenn., firm. He’s still a minority owner in the employee-owned business and is always willing to provide advice regarding the company he founded and the industry he loves.
“I loved every job that I ever had since graduating from college. But Vining Sparks was my baby,” Vining says. “I can’t say I enjoyed every minute, because 2008 came along, and that wasn’t a lot of fun.” But, on the whole, he says, it was a wonderful experience.
Vining’s pride and joy is how much his firm has grown since he started it in 1981 with a $1 million capital infusion from the late Willard Sparks, a highly respected Memphis-based commodity broker.
From an initial staff of 17 people, Vining Sparks now has more than 350 employees in 14 offices across the country. The firm began serving only community banks but now works with roughly 4,500 institutional investors, including banks, credit unions, municipalities, money managers, trust departments, insurance companies, pension funds and investment advisors. It has about $100 million in capital and an annual trading volume of more than $150 billion.
Vining was born in Bristow, Okla., on Oct. 1, 1942, the oldest of four children. He met his wife, Ann, in eighth grade; they have four children.
From the start of his career, he was focused on community banks. Before starting Vining Sparks, Vining headed strategic planning for the Federal Reserve Banks in Atlanta and Washington. He then built a bond department from scratch for Union Planters Bank in Memphis. After eight years with the bank, the itch to start his own institutional broker-dealer took hold, and with his wife’s encouragement, Vining Sparks was born.
“Our business plan was analytics, and the analytics would drive the bond sales.”
—Jim Vining, Vining Sparks
The company began as an institutional bond dealer serving community banks. Then, in 1988, ICBA awarded it an exclusive contract to provide institutional broker-dealer services to its members—a pact Vining says helped propel his firm down a path to success. “Winning the ICBA contract put us in a really different light from our competitors,” he says. “Community banks rely on, and they depend on, and they trust ICBA. The fact that ICBA selected us to be its investment broker was not a small deal at all. We now were able to call on customers that wouldn’t talk to us otherwise.”
Vining also notes how instrumental C.J. Pickering, the former president and CEO of ICBA Securities, now led by Jim Reber (see page 82), was in ensuring the partnership’s success.
Vining Sparks’ success also stems from the proprietary bond software Vining and his team developed to help customers with balance sheet management, portfolio management and regulatory reporting.
Vining’s mantra was that the firm had to do more than sell bonds to community banks. “Our business plan was analytics, and the analytics would drive the bond sales,” he says.
It was a winning plan that has since drawn widespread recognition. In 2006, Vining was inducted into Oklahoma State University’s Engineering Hall of Fame. And in 2014, he was named a Master Entrepreneur by the Society of Entrepreneurs in Memphis.
Over the years, the firm has continued to develop proprietary software and employ third-party tools to help banks manage their portfolios. As new bond products come to market, Vining Sparks thoroughly researches them to educate customers on their potential risks and rewards. “We attempt to make sure that a product is safe; we never sold sub-prime mortgages, for example,” Vining says.
To thrive today, Vining believes community banks need to ensure they have the right leadership at the helm, and build up their commercial banking rather than focus so heavily on retail; he predicts the former will be more successful in the long run.
Retail-focused banks “wind up competing with each other right down to the last nickel,” he says. By contrast, corporate clients are stickier. They aren’t typically swayed by price wars, because “switching banks is a tremendous hassle” for them, Vining says.
As for the future of Vining Sparks, he predicts it will be rosy. “I think we will continue to grow, our capital will continue to grow, and we will be adding branches and employees,” he says. “It’s a necessity. No company can stay stagnant and be successful.”
Cheryl Winokur Munk is a writer in New Jersey.