5 Questions

By Graham Clark August 31, 2010

Back In Banking

Tramm Hudson, 57, has weathered the ups and downs of the banking industry for almost three decades. He was a founding director and president of Enterprise National Bank of Sarasota and the Florida executive director of Provident Bank, overseeing a 13-branch network in Sarasota, Manatee and Hillsborough, which eventually grew to $850 million in assets. After Provident Bank sold to North Carolina-based RBC Centura Bank, Hudson retired in 2006 to run unsuccessfully as the Republican candidate for the 13th Congressional District. In 2009 Hudson became area president for Whitney National Bank, a regional community bank with offices in five states along the Gulf of Mexico. He oversees eight officers, 60 employees and more than $350 million in assets.


How is it different being a bank president today?

Banking is not as much fun as it used to be. Banks reflect the condition of the customers, and our customers are hurting. Many of the customers who are going through tough times are friends, some of them for more than 20 years. You get to know them. You spend time in their business or with their staff, listening to how they want to expand. When they suffer setbacks, you feel the pain.

Regional and major banks are aggressively taking market share. Does this mean we’ll see fewer community banks here?

Nine out of 10 banks that failed here in the last two years were what I would call community banks. The community bank model of the past 30 years is broken. Community banks would fund their bank with retiree deposits and lend money on commercial real estate ventures. There used to be a saying: “Lend on dirt, can’t get hurt.” Now it’s, “Lend on dirt, lose your shirt.” It’s a much different kind of model. And I think we’ll see a greater shift toward the consumer market.

What will the new financial reform passed by Congress mean for banks?

You’ll see the increased cost of credit, the availability of credit will be restricted, there’ll be tougher qualification criteria, and the expense of having to report and implement these new regulations will be burdensome on the banking industry as well as the consumer. Now, you can’t have more than 300 percent of your equity in commercial real estate. Many community banks had upwards of 1,000 percent or more of their equity invested in commercial real estate, so they’ll be limited.

Do you see yourself in banking for a long time?

I sold three banks in the last 10 years and had actually retired. I thought at 55 I could do that. But you invest in things you know best, and I had invested in bank stocks over the years like Bank of America, Citigroup.

Then the financial sector had a meltdown in 2008 and banks suspended dividends. I told my wife, “Shoot, I need to get back in the game.” I am so lucky to have lost so much and be young enough to have an opportunity to earn it back.

What advice would you give business customers today?

It’s more important to choose a banker than a bank. Ten years ago, credit was much easier and freer, and the competition for bank business was intense, so you were choosing access to credit. Today it’s about who takes the time to understand your business and can advise you in a consulting matter. All banks have the same money. It’s all green. I tell my people to use TLC—Think Like the Customer. On my tombstone, I want it to say, “This guy was a great banker because he believed in TLC.”

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