Hubris Kills Banks: The Critical balance between Ambition and Humility in Banking Success

Brent Beardall: 00:00:00

the call center should just be online banking.

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It really should be a, a different front end to be able to access it.

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one of the very, very cool things of working with Amazon, we have, uh, all

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of our cloud infrastructure at Amazon.

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So we were able to work with them and basically take their Alexa technology

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and put that in, online banking so you can now call in with your voice and

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it authenticates you using your voice.

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even better is the security aspect of it, because it has to be your

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voice from your phone we know AI can duplicate your voice, so

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it's very secure.

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It's multifactor authentication, but how cool that when it

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calls in, it says hybrid.

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How can I help you?

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welcome to Fintech Confidential, bringing you the people, tech, and companies

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that change how you pay and get paid.

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Welcome to accrued the FinTech confidential series presented by Loan Pro.

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In this series, we're deconstructing the complexities of lending and

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exploring compliance, optimization, modernization, and personalization.

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Through insightful conversations with the industry's best,

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I'm Tedd Huff, and with my.

Tedd Huff: 00:01:10

cohost, Colton Pond will be guiding you through the intricate lending world.

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Whether you're deep in Lin Tech or just intrigued on how the

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technology is reshaping the lending industry, you're in the right place.

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So let's go ahead and dive into the next episode of Accrued.

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Brent, one of the really cool things is you and I have had the

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opportunity to, to meet and we're, I'm super glad to have you on here.

Tedd Huff: 00:02:06

I know Colton's super glad to have you on.

Tedd Huff: 00:02:09

And you know, one of the things that I thought was really interesting is, is

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you and I have talked, and I've done a little bit of research under your

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leadership.

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Wafd Bank has

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Tedd Huff- Host, Fintech Confidential (Detached audio): become a massive powerhouse worth

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over $22 billion in assets, and your footprint has, has expanded out

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into eight of the Western states.

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And not only that, but in 20 21, 4 of those banks.

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We're recognized by Newsweek as the best bank, and that is one of the things that

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as we get into this, we'll dive into the commitment to excellence and innovation

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that has brought you to that point.

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for those who don't know, your Brent's journey

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started with WaFd Bank back

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Tedd Huff- Host, Fintech Confidential (Detached audio): in 2001, and he held a number of different

Tedd Huff: 00:02:56

roles, and from from our original discussion, Brent, the first role that

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you had was when you really weren't too excited about, but then you kind of

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moved yourself through the CFO, chief Banking Officer, and then in 2017 you

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were appointed the president and CEO, and you became only the sixth president,

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or sorry, sixth, CEO in the bank's history, which spans over a hundred years.

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Approximately one year later after that.

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You launched the Ambitious Vision 2025 Initiative to transform into a digital

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first bank and focusing on how you can help your clients with their financial

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health and making great decisions.

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And you have a quote that I love and I keep going back to is love

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what you do and make a difference.

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Colton, you've had the opportunity to really get to know Brent, and

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I'd love you to talk about some of the other things that people can't

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find by just doing a Google search.

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What else should we know?

Colton Pond: 00:03:58

It's a great question.

Colton Pond: 00:04:00

I, I, it's a lot of things I could share here.

Colton Pond: 00:04:02

Uh,

Colton Pond: 00:04:02

funny enough, last week, for those that have watched the, the series

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to the point, we had John Maxfield on the show, and, uh, in the middle of the

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show, John's phone blown up, blown up.

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It's like five or six calls, and he is like,

Colton Pond: 00:04:14

Brent Beall trying to get ahold of me.

Colton Pond: 00:04:15

I was like, you know what?

Colton Pond: 00:04:16

Brett's one of the best humans I've ever met, and also one of the smartest,

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uh, banking leaders that I've ever met.

Colton Pond: 00:04:21

Um, let's have him on the show, but sincerely, one of the best humans that

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I've ever met, and one of the, the people that has the, the deepest heart

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and ability to love, but also lead the people around him in, in a meaningful way.

Colton Pond: 00:04:34

So, Brett, I know you didn't need all that intro, but it is a

Colton Pond: 00:04:37

pleasure to have you on the show.

Brent Beardall: 00:04:39

Hey, Colton, first of all, I'm sorry to have fooled you, but clearly

Brent Beardall: 00:04:43

I, I have to have you totally fooled.

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And Tedd I don't know if you're available, but I'm looking for a new agent and I

Brent Beardall: 00:04:48

think you're just the for job.

Colton Pond: 00:04:51

Oh.

Tedd Huff: 00:04:52

Oh, Brent.

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Well, thank you.

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Uh, you know, today's discussion.

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We're gonna dive into you, Brent, you sharing your insights, how you've

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navigated the challenges and how other regional banks can, can use

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the role of technology in banking to really move themselves forward.

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And you've really got an interesting story around your personal journey of

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resilience and how you've leveraged that in your leadership across the bank.

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Colton, I, I know you wanted to, to dive into, of, some of the things

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about, about Brent that in his leadership style that you've learned.

Colton Pond: 00:05:28

one of the biggest things, Brent, last week when

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we talked to John Maxfield.

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in the, in John Maxwell's way, he basically said, Hey, the best banking

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leaders have some sort of hardship or strategy in their life that they

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overcome and that helps them become and become way better leaders.

Colton Pond: 00:05:43

So I would love to under or to give the audience an opportunity to understand what

Colton Pond: 00:05:48

that is for you, what kind of leader you are, and how you think about leadership

Colton Pond: 00:05:52

at the bank and driving WaFd forward.

Brent Beardall: 00:05:55

Uh, that, that's a, that's a pretty powerful way to start,

Brent Beardall: 00:05:58

but, we'll, we'll, we'll go ahead and start and, uh, and tribute to John.

Brent Beardall: 00:06:01

And, uh, Tedd and I were talking a little bit about this, it actually

Brent Beardall: 00:06:05

started for me when I was young, when I was, uh, only 15 years of age on.

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Christmas day, my father had been sick.

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And, um, my mom woke me up in the middle of the night, uh, between the

Brent Beardall: 00:06:17

25th and 26th and said, come in here.

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Dad's not doing well.

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And um, my dad was in a coma, uh, at the time, and we, we said, okay, we need

Brent Beardall: 00:06:27

to get him to the hospital to take too long to, uh, get the paramedic there.

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So I literally picked up my dad and carried him to the car and

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we took him to the hospital.

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I was 15 at the time of 1987.

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Remember, it's, you know, some things are just burned into your memory.

Brent Beardall: 00:06:42

My father never woke up from that.

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Uh, he passed seven days later.

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And so, uh, that was one of the defining moments in my life in that it forced

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me to kind of develop this switch.

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To be very, very serious.

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. At 15 years old who wants to be serious.

Brent Beardall: 00:06:58

Right.

Brent Beardall: 00:06:58

I was a, a teenager in, you know, California.

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I wanted to, you know, play in the surf and the sand and volleyball

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and, but I had to be really serious.

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But I also had to figure out that there's a way to flip a switch

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between being serious and having fun.

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And there's room in life to do both.

Brent Beardall: 00:07:15

And so it really forced me to mature, uh, pretty early.

Brent Beardall: 00:07:18

So that, that was kind of one defining moments for me.

Brent Beardall: 00:07:21

And I, to this day, I, I still like to blow people away.

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People say, oh, bank CEO can't do that.

Brent Beardall: 00:07:28

Hell yes, they Bank c banky CEOs can have lives, right?

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We can have personalities, we can be, be ourselves and we can say stupid

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things and we can dress like fools.

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It doesn't matter.

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Uh, what matters is that we're authentic.

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We're ourselves, and we work together with our teams to get stuff done.

Brent Beardall: 00:07:46

Um, and then secondly, uh, the big defining thing was about a year ago.

Brent Beardall: 00:07:51

Unfortunately, I was in a plane accident.

Brent Beardall: 00:07:54

Uh, on January 2nd of the 2023, there was a tragic plane accident that,

Brent Beardall: 00:07:59

uh, unfortunately took the life of my friend, the copilot or the pilot.

Brent Beardall: 00:08:03

And, uh, I was in the copilot seat.

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And, uh.

Brent Beardall: 00:08:07

Anyhow, suffered life threatening injuries.

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Uh, it was touch and go, uh, for me for a while.

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Uh, but bottom line, after a couple of days of surgeries and thanks to the love

Brent Beardall: 00:08:19

and prayers of so many, I was able to make it out and, um, I was able to get back to

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work, uh, when February 13th of last year.

Brent Beardall: 00:08:28

still in a wheelchair, uh, and people are like, Beardall you're nuts.

Brent Beardall: 00:08:32

Why would you go back to work?

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And I'm like, you don't understand.

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For me, work is an outlet.

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It's, it's a wonderful thing.

Brent Beardall: 00:08:38

It fills my cup.

Brent Beardall: 00:08:40

And so, uh, that, that has been a real defining moment for me.

Brent Beardall: 00:08:43

And just quickly, I mean, we, we could talk for hours on this.

Brent Beardall: 00:08:48

A couple of the lessons I, I learned in going through that.

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Number one, I was absolutely blown away and humbled by the

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outpouring of love and support.

Brent Beardall: 00:08:58

I, uh, a couple of people said, and this will sound morbid, but there's

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truth to it, that I had the good fortune of living through my own

Brent Beardall: 00:09:04

funeral, seeing the outpouring of love and support while I was still here.

Brent Beardall: 00:09:09

And one of the lessons I've learned is to not be ashamed or be

Brent Beardall: 00:09:14

afraid to tell people I love them.

Brent Beardall: 00:09:16

When people make a difference in my life, uh, somebody that we both know

Brent Beardall: 00:09:21

and love, Colton Brandon dewitt,

Brent Beardall: 00:09:23

would not be afraid to tell you he loved you.

Brent Beardall: 00:09:25

And I wouldn't be afraid to tell Brandon I loved him, right?

Brent Beardall: 00:09:27

Because life is too short to not tell the people that matter in your life that you

Brent Beardall: 00:09:32

love him and you grow up in this mistaken, uh, you know, identity, if you will.

Brent Beardall: 00:09:39

That if you're a professional, you can't tell somebody at work that you love them.

Brent Beardall: 00:09:43

Uh, that's, that's misguided in my opinion.

Brent Beardall: 00:09:47

Uh, yeah.

Brent Beardall: 00:09:48

Right.

Brent Beardall: 00:09:48

Clearly it's a professional environment.

Brent Beardall: 00:09:50

You need to keep it professional, but that doesn't mean you can't love people.

Brent Beardall: 00:09:53

And, uh, it, it's, it's one of the great lessons I've had and it's

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disarming and it also gives people.

Brent Beardall: 00:10:01

The authority to tell you how, how they feel,

Brent Beardall: 00:10:04

and whether that be, whether they love you or hate you.

Brent Beardall: 00:10:06

Right?

Brent Beardall: 00:10:07

It's not right.

Brent Beardall: 00:10:07

It's not, uh, one for one by any means, but it allows you to be real.

Brent Beardall: 00:10:12

It allows you to be authentic.

Brent Beardall: 00:10:14

And that gets back to what, what you led with this question, Tedd

Brent Beardall: 00:10:18

in terms of love, what you do.

Brent Beardall: 00:10:20

And, uh, to me, you have to be passionate about what you do.

Brent Beardall: 00:10:24

Life is too short.

Brent Beardall: 00:10:26

Every day we have is a gift.

Brent Beardall: 00:10:28

How do we choose to invest that time?

Brent Beardall: 00:10:30

There's any number of things we can do.

Brent Beardall: 00:10:32

Figure out a way to love what you do.

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And if you don't go do something else, you're empowered.

Brent Beardall: 00:10:38

And that that is the beauty of living in this country, having freedom.

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We can do whatever the hell we wanna do.

Brent Beardall: 00:10:43

So figure out how to do something that you love, what you're doing.

Brent Beardall: 00:10:47

And that's the advice I always tell kids when they say, well, what

Brent Beardall: 00:10:50

field should I go into working in?

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So what are you passionate about?

Brent Beardall: 00:10:54

What do you care about?

Brent Beardall: 00:10:55

Right?

Brent Beardall: 00:10:56

And that doesn't mean all of our jobs are sexy,

Brent Beardall: 00:10:59

mean, each, each and every one of us, there's things you go, oh my goodness,

Brent Beardall: 00:11:03

I have to spend time doing this.

Brent Beardall: 00:11:05

But it, as we all know, sometimes you've gotta take the bad with the good.

Brent Beardall: 00:11:09

And it's, it's not all roses, but on, in totality.

Brent Beardall: 00:11:13

You, you have to love what you do.

Brent Beardall: 00:11:14

Then after you figure out how to love what you do, be passionate

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about what you're doing.

Brent Beardall: 00:11:19

The real key to culture, in my opinion, is making a difference, right?

Brent Beardall: 00:11:25

Because that's, and Tedd you and I have talked about that, that's caring.

Brent Beardall: 00:11:28

You want employees that care, and if you care, you're not gonna

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see something that's going wrong and say, yeah, not my issue.

Brent Beardall: 00:11:36

Let somebody else deal with it.

Brent Beardall: 00:11:38

You're gonna say, I don't care what my job description says.

Brent Beardall: 00:11:40

If there's a problem, I wanna try to solve that, right?

Brent Beardall: 00:11:43

Because we're here to try to create raving fans.

Brent Beardall: 00:11:47

If we're not here to create raving fans, go someplace else, I wanna fill the bank

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with people that wanna create raving fans.

Brent Beardall: 00:11:54

Life is too short not to have raving fans and it as a result,

Brent Beardall: 00:11:58

we've been able to take our net promoter score from a 17, five years ago up

Brent Beardall: 00:12:01

to a 57, I think a 57 net promoter score puts us probably in the top 15%

Brent Beardall: 00:12:07

of all financial institutions in the United States, which is not bad for a

Brent Beardall: 00:12:10

bank that's been around for 105 years.

Brent Beardall: 00:12:12

And believe me, we still have wood to chop.

Colton Pond: 00:12:14

Yeah, I love that.

Colton Pond: 00:12:16

Uh, Brett, there's two aspects that I will, one, I I will say

Colton Pond: 00:12:19

I've been to WaFds headquarters, you see it in your employees.

Colton Pond: 00:12:22

Like when I walked in, you into some banks, you're like, uh,

Colton Pond: 00:12:26

people don't wanna be there.

Colton Pond: 00:12:28

Clock in at nine, out at five.

Colton Pond: 00:12:29

They're like, I'm done.

Colton Pond: 00:12:30

Right?

Colton Pond: 00:12:30

I'm out.

Colton Pond: 00:12:31

but you see the passion and the passion that you brought there.

Colton Pond: 00:12:34

And then the other aspect you brought up Brandon Dewitt, um, who was both mine

Colton Pond: 00:12:38

and, and Brent's really good friend, the the late CTO and Co-founder of mx.

Colton Pond: 00:12:43

But he would always say something that, I remember when I heard about your accident

Colton Pond: 00:12:47

and we spoke after I thought about,

Colton Pond: 00:12:48

he would always say, life is beautiful and act like it.

Colton Pond: 00:12:51

And it is.

Colton Pond: 00:12:51

Life is beautiful.

Colton Pond: 00:12:52

Life is a beautiful gift.

Colton Pond: 00:12:54

: Amen.

Colton Pond: 00:12:55

what's awesome to me to see, especially at WaFd is you turning

Colton Pond: 00:12:58

around metrics like NPS and other things like that, but doing it at the top.

Colton Pond: 00:13:02

you as a, a leader of WaFd and your entire executive team.

Colton Pond: 00:13:06

Aligned on driving forward the mission purpose of WaFd and all down to the

Colton Pond: 00:13:10

entry level tellers at, at the bank and, and everyone throughout the bank.

Colton Pond: 00:13:14

And I love that culture.

Colton Pond: 00:13:16

It's, I think it's a key aspect of the success that you all have driven.

Brent Beardall: 00:13:20

Well, and, and the sad reality is we have a co, a

Brent Beardall: 00:13:24

competitive advantage because there's a lot of bank management teams.

Brent Beardall: 00:13:28

They're just here to ride out till retirement.

Brent Beardall: 00:13:32

you know, I really don't want to take a chance on x, y, Z

Brent Beardall: 00:13:35

initiative because it could fail.

Brent Beardall: 00:13:37

Why?

Brent Beardall: 00:13:37

Why?

Brent Beardall: 00:13:38

Why would I upset the apple cart?

Brent Beardall: 00:13:40

And to us, we've got a fairly young management team that we've got, you know,

Brent Beardall: 00:13:45

10, 15, 20 years in front of us and we're like, hell yeah, let's take a chance.

Brent Beardall: 00:13:50

Let's try to do something special.

Brent Beardall: 00:13:52

Let's see, how can we literally leapfrog generations of technology and.

Brent Beardall: 00:13:57

Right.

Brent Beardall: 00:13:58

One of our biggest problems is how do we hire bankers today?

Brent Beardall: 00:14:02

So let's, let's utilize ai.

Brent Beardall: 00:14:05

To make the jobs more interesting, right, to allow them to do things.

Brent Beardall: 00:14:10

Uh, we're, we're, right now we're going through a conversion.

Brent Beardall: 00:14:13

we just got approved to acquire Luther Burbank in California.

Brent Beardall: 00:14:16

It's a $8 billion bank.

Brent Beardall: 00:14:18

Uh, we will close on the transaction on the 29th of February.

Brent Beardall: 00:14:22

So that's, uh, leap Day, Thursday the 29th.

Brent Beardall: 00:14:25

On Friday the 1st of March, we will close the branches early

Brent Beardall: 00:14:28

and we will start conversion.

Brent Beardall: 00:14:30

And on Monday the fourth, we will have every one of their systems converted,

Brent Beardall: 00:14:34

all the signage, everything done.

Brent Beardall: 00:14:36

To my knowledge in the history of banking, there may be one or

Brent Beardall: 00:14:40

two, but I don't know about 'em.

Brent Beardall: 00:14:41

Nobody has done it faster than that.

Brent Beardall: 00:14:44

Right?

Brent Beardall: 00:14:44

And believe me, there is fur flying all over the place.

Brent Beardall: 00:14:47

I mean, there's all of things that need to happen right now,

Brent Beardall: 00:14:50

what I have everybody focused on, we, in each of their branches,

Brent Beardall: 00:14:54

we will have two wafe employees.

Brent Beardall: 00:14:56

And we're going to go out not only and greet the customers as they

Brent Beardall: 00:15:00

come in, we're getting lists of all their customers, their you, their,

Brent Beardall: 00:15:03

their largest, their best customers.

Brent Beardall: 00:15:05

And we're gonna call 'em up individually

Colton Pond: 00:15:07

I love that.

Colton Pond: 00:15:08

Tedd Huff- Host, Fintech Confidential (Detached audio): Nice.

Brent Beardall: 00:15:08

and say, welcome to WaFd Bank.

Brent Beardall: 00:15:10

Let me introduce myself.

Brent Beardall: 00:15:11

I don't need anything from you.

Brent Beardall: 00:15:12

I'm not scamming you or anything.

Brent Beardall: 00:15:14

I just wanna let you know we're here.

Brent Beardall: 00:15:15

We care about you.

Brent Beardall: 00:15:16

We appreciate it.

Brent Beardall: 00:15:17

And by the way, let me tell you about the products and services we can

Brent Beardall: 00:15:21

offer now that you didn't have before.

Brent Beardall: 00:15:23

It's not rocket science.

Brent Beardall: 00:15:26

It turns out people care.

Brent Beardall: 00:15:28

If you can personalize an experience, you differentiate yourself.

Tedd Huff: 00:15:32

Well, and that that aligns with the human-centered leadership,

Tedd Huff: 00:15:35

that, that you've establ that culture that you've established at the bank.

Tedd Huff: 00:15:41

And I'm curious

Tedd Huff: 00:15:42

how have you seen your personal values in the culture, mission, and vision of

Tedd Huff: 00:15:49

the bank transform as as you have, and especially with this acquisition, how

Tedd Huff: 00:15:56

do you see that lending to a smooth transition in such a short time?

Brent Beardall: 00:16:02

it's really all about empowerment, right?

Brent Beardall: 00:16:05

If, if I'm going to challenge everybody to love what they do

Brent Beardall: 00:16:08

and make a difference, I have to empower them to make that difference.

Brent Beardall: 00:16:12

Um, you, you, you know how it is in banking.

Brent Beardall: 00:16:15

It, it's typically about command and control.

Brent Beardall: 00:16:18

And internal controls that will prevent you from making mistake

Brent Beardall: 00:16:22

after mistake after mistake.

Brent Beardall: 00:16:24

And generally you can't get anything done.

Brent Beardall: 00:16:26

We had to be willing to let go a little bit and recognize that it's okay to fail.

Brent Beardall: 00:16:34

My, my, my, my, I tell people they need to be failing because if they're not

Brent Beardall: 00:16:38

failing, they're not trying hard enough.

Brent Beardall: 00:16:40

I, I would imagine one or both of you ski a little bit, right?

Brent Beardall: 00:16:44

If you're a skier and you're never falling, it means you're not pushing

Brent Beardall: 00:16:47

it hard enough, You're just kinda,

Colton Pond: 00:16:49

that all the time, like all the time.

Colton Pond: 00:16:52

Every time we go skiing and she's taking it, she's like, she ends the

Colton Pond: 00:16:55

day and she's like, I fell five times.

Colton Pond: 00:16:57

How many times did you fall today it's a badge of honor.

Colton Pond: 00:16:59

You're so right.

Brent Beardall: 00:17:01

No, no, it, it is right?

Brent Beardall: 00:17:02

And it's too easy to just go through life just coasting, Hey, yeah,

Brent Beardall: 00:17:06

I didn't, I didn't fall at all.

Brent Beardall: 00:17:08

And again.

Brent Beardall: 00:17:10

This is just my judgment.

Brent Beardall: 00:17:12

Maybe I'm totally wrong, but no, I, I wanna be pushing the edge of

Brent Beardall: 00:17:15

the envelope to be getting better, to be improving and improving what

Brent Beardall: 00:17:19

we're offering to our clients.

Brent Beardall: 00:17:21

And that means sometimes we're gonna make mistakes, but if you make mistakes,

Brent Beardall: 00:17:24

right, you don't wanna fall off the cliff when you're skiing, right?

Brent Beardall: 00:17:27

You, you wanna, you wanna fall and somewhere that have powder and, you know,

Brent Beardall: 00:17:31

make sure it's not a yard sale, right?

Brent Beardall: 00:17:33

I say.

Brent Beardall: 00:17:34

Fail small, fail quickly, right?

Brent Beardall: 00:17:36

If you're gonna fail, you don't want it to be a 12 month failure process.

Brent Beardall: 00:17:39

It needs to be quickly,

Brent Beardall: 00:17:40

everybody's focus on the failures.

Brent Beardall: 00:17:42

Those failures enable outsized potential in terms of what you

Brent Beardall: 00:17:46

can get done by taking chances and thinking outside the box.

Brent Beardall: 00:17:50

And so that's really the key for me, is to say, Hey, this

Brent Beardall: 00:17:54

is what we're gonna try to do.

Brent Beardall: 00:17:55

What do you need from me to empower you to get it done?

Colton Pond: 00:17:59

I love the focus on how to empower your team members.

Colton Pond: 00:18:01

It's inter, as I've interacted with lots of your team members at WaFd

Colton Pond: 00:18:06

Bank, it's evident that they feel empowered, where that's not always

Colton Pond: 00:18:10

the case within the banking ecosystem.

Colton Pond: 00:18:12

y'all are, would be considered a regional bank, and we know over the past year and

Colton Pond: 00:18:17

a half or so, the negative consequences that hit have hit regional banks

Colton Pond: 00:18:21

and y'all have continued to grow and continue to show, uh, positive metrics.

Colton Pond: 00:18:25

I would love your perspective on man, man, what's, what's the secret sauce.

Colton Pond: 00:18:31

Um, what advice would you give to regional banks like you, you mentioned a lot about

Colton Pond: 00:18:35

taking risks and personalizing, like what advice would you give to regional banks

Colton Pond: 00:18:39

on how they stay relevant and profitable?

Brent Beardall: 00:18:42

Yeah, well this is probably similar to what you heard

Brent Beardall: 00:18:44

from John Maxfield, uh, because he and I have talked about it a lot.

Brent Beardall: 00:18:48

I try to be a student of banking history, right, because I wanna

Brent Beardall: 00:18:51

learn from others' mistakes.

Brent Beardall: 00:18:53

Uh, and if you look at bank failures historically, there is

Brent Beardall: 00:18:58

one common theme and that's hubris.

Brent Beardall: 00:19:01

It is human nature.

Brent Beardall: 00:19:03

You start having success and you start thinking that your, you know, body

Brent Beardall: 00:19:07

odor doesn't smell and you, you, you start thinking, you are all of that.

Brent Beardall: 00:19:12

And the reality is, no, my body odor smells right.

Brent Beardall: 00:19:15

I, I can stink at times.

Brent Beardall: 00:19:17

And you don't want to surround yourself with people that are

Brent Beardall: 00:19:20

just, Brent, you're so great.

Brent Beardall: 00:19:22

This is fantastic.

Brent Beardall: 00:19:23

And hopefully I do have some things that are, I'm doing okay,

Brent Beardall: 00:19:26

but I want people that also call me out and say, Berdall, what the

Brent Beardall: 00:19:30

hell were you thinking about this?

Brent Beardall: 00:19:32

Or, Hey, y you wanna, you wanna go, you know, run X, X, Y, Z play.

Brent Beardall: 00:19:37

That's exactly the wrong play we need to do.

Brent Beardall: 00:19:40

You know the other, play the opposite direction and it be

Brent Beardall: 00:19:45

empowered to have that conversation.

Brent Beardall: 00:19:48

It's one of the things that we are missing in our society today

Brent Beardall: 00:19:52

is constructive disagreement.

Brent Beardall: 00:19:53

I.

Brent Beardall: 00:19:54

Right.

Brent Beardall: 00:19:54

Let, let, let's be able to disagree.

Brent Beardall: 00:19:56

At the end of the day, we all need to rally and get on the same page,

Brent Beardall: 00:19:59

and I need to be humble enough to admit when I'm wrong, because there's

Brent Beardall: 00:20:02

gonna be times when I'm wrong.

Brent Beardall: 00:20:04

And that's what I think is part of making a difference, uh, here at the bank.

Brent Beardall: 00:20:09

I tell employees all the time, if they ever hear me say something

Brent Beardall: 00:20:11

that they believe is patently false, call me out on it.

Brent Beardall: 00:20:16

All right.

Brent Beardall: 00:20:16

There could be nothing worse than a leader that gets up there

Brent Beardall: 00:20:19

and says something that's wrong.

Brent Beardall: 00:20:20

Hopefully they do it in a respectful way and so forth.

Brent Beardall: 00:20:24

But no, I'm not all that.

Brent Beardall: 00:20:26

you look at Silicon Valley Bank, which caused the crisis of last spring,

Brent Beardall: 00:20:30

they were guilty of a lot of things.

Brent Beardall: 00:20:33

They were guilty of mismanaging the bank from an interest rate

Brent Beardall: 00:20:35

risk standpoint, but their biggest.

Brent Beardall: 00:20:38

Fault, in my opinion, was hubris.

Brent Beardall: 00:20:41

Every time they went to the capital markets, the capital markets

Brent Beardall: 00:20:44

said, how much money do you want?

Brent Beardall: 00:20:46

They would give them more capital every single time for 40 years.

Brent Beardall: 00:20:50

: So the hubris was, you know what, let's announce this balance sheet.

Brent Beardall: 00:20:54

Restructuring that we're gonna take $2 billion of losses and so what?

Brent Beardall: 00:21:00

It blows a hole in our balance sheet.

Brent Beardall: 00:21:01

We'll just go, you know,

Brent Beardall: 00:21:02

past the hat and get more capital.

Brent Beardall: 00:21:06

The, the hubris was just that, you know, hey, somebody else, they'll,

Brent Beardall: 00:21:11

they'll solve the problem in the, in the equity market, said, okay,

Brent Beardall: 00:21:14

great, we we like you, we'll fill it.

Brent Beardall: 00:21:17

You took $2 billion of losses.

Brent Beardall: 00:21:19

Let us ask one more question.

Brent Beardall: 00:21:20

How much more do you have to take in losses?

Brent Beardall: 00:21:24

And when they looked at that, and it was in all their public

Brent Beardall: 00:21:26

disclosures, if you took all of their losses, they were insolvent

Colton Pond: 00:21:31

wow.

Brent Beardall: 00:21:32

and people said, holy crap.

Brent Beardall: 00:21:34

Why would we put more money into a bank that's effectively insolvent,

Brent Beardall: 00:21:38

and then you have the most sophisticated deposit base out there.

Brent Beardall: 00:21:41

One person started calling another, the tweets went out, and all of a sudden the

Brent Beardall: 00:21:45

run

Brent Beardall: 00:21:46

as simple as that.

Brent Beardall: 00:21:47

It was hubris had they just simply said, you know what?

Brent Beardall: 00:21:53

We've got a problem here.

Brent Beardall: 00:21:55

Let's raise more capital.

Brent Beardall: 00:21:57

For general corporate purposes,they would've gone out and raised $3

Brent Beardall: 00:22:02

billion of capital and then waited three weeks, and then they could have

Brent Beardall: 00:22:06

done a balance sheet re restriction.

Brent Beardall: 00:22:07

They would still be here today with one of the best deposit franchises

Brent Beardall: 00:22:12

in the United States of America.

Brent Beardall: 00:22:13

So that is one thing I am constantly trying to remind myself of and of my team.

Brent Beardall: 00:22:19

Let's avoid hubris,

Brent Beardall: 00:22:21

Because you get into these positions, oh my goodness, you're the CEO of A now

Brent Beardall: 00:22:25

a $30 billion financial institution.

Brent Beardall: 00:22:28

And you can do no wrong,

Brent Beardall: 00:22:31

wrong.

Brent Beardall: 00:22:32

B.S.

Brent Beardall: 00:22:32

You can do a lot of wrong and you need to surround yourself with people that

Brent Beardall: 00:22:36

will call you out on it when you do it.

Brent Beardall: 00:22:37

And quite frankly, that's a job of your board of directors,

Brent Beardall: 00:22:41

right?

Brent Beardall: 00:22:41

And that's why you need a board of directors that is willing to say, Hey,

Brent Beardall: 00:22:45

you know what, I, I think this is wrong.

Brent Beardall: 00:22:47

let's have that active discussion in.

Brent Beardall: 00:22:51

By, damn.

Brent Beardall: 00:22:51

If I can't convince you why I think we should do something, then we

Brent Beardall: 00:22:55

probably shouldn't be doing it.

Colton Pond: 00:22:56

I'm curious your perspective as well on.

Colton Pond: 00:22:59

The role that technology has played at Wafd Bank, uh, Wafd or Tedd mentioned

Colton Pond: 00:23:05

that y'all have, uh, really focused, and I've seen this on, on the leap to be more

Colton Pond: 00:23:10

digital centric and be digital first.

Colton Pond: 00:23:12

Um, what role has technology played as far as differentiation and growth?

Colton Pond: 00:23:16

And what role do you feel like technology will play moving forward too?

Brent Beardall: 00:23:19

Banking is one of the very industry interesting

Brent Beardall: 00:23:22

professions that you're really paying it forward, uh, right.

Brent Beardall: 00:23:26

The results we are experiencing today are the results of work that had occurred.

Brent Beardall: 00:23:32

3, 4, 5, 6, 7 years ago,

Brent Beardall: 00:23:35

what we are planting the seeds today that we will harvest, uh,

Brent Beardall: 00:23:39

you know, the, the fruits of that three, four or five years from now.

Brent Beardall: 00:23:43

So it, it is one of those interesting things.

Brent Beardall: 00:23:46

And back when I had the good fortune of taking over as CEO

Brent Beardall: 00:23:49

I said we have this.

Brent Beardall: 00:23:52

Question a choice how right.

Brent Beardall: 00:23:55

We can go for the next 10 years and we can, we can try to spend as little as

Brent Beardall: 00:24:00

possible and just harvest as much as we can out of this stream of revenue that's

Brent Beardall: 00:24:05

coming our way that we'll be dwindling,

Brent Beardall: 00:24:08

: atrophy was happening.

Brent Beardall: 00:24:09

We're losing customers and.

Brent Beardall: 00:24:11

But still could be very, very profitable until it's not.

Brent Beardall: 00:24:14

It's back to that hubris.

Brent Beardall: 00:24:16

No, we, we can't change because what we're doing is working so well

Brent Beardall: 00:24:20

and I, I went to the board and not only did the board agree with me,

Brent Beardall: 00:24:24

they said, Brent, you need to do it faster, you need to aim higher

Brent Beardall: 00:24:28

historically people did business with us for two reasons.

Brent Beardall: 00:24:31

One, a rock solid balance sheet.

Brent Beardall: 00:24:33

That's kind of our DNA.

Brent Beardall: 00:24:34

That's who we are.

Brent Beardall: 00:24:35

We, we don't make, you know, very risky loans from a credit perspective.

Brent Beardall: 00:24:39

And number two, relationships matter.

Brent Beardall: 00:24:41

Customer service.

Brent Beardall: 00:24:42

That's who we are.

Brent Beardall: 00:24:43

It's fact that personalized service, it's fantastic.

Brent Beardall: 00:24:45

And I said, wouldn't it be great

Brent Beardall: 00:24:48

if we could really pair those two attributes, those qualities, those

Brent Beardall: 00:24:52

values with a third, which is technology that makes people go, wow.

Colton Pond: 00:24:57

I love that.

Colton Pond: 00:24:58

: Right.

Colton Pond: 00:24:58

Simple as that.

Colton Pond: 00:24:59

I, I, I don't complicate technology.

Colton Pond: 00:25:02

At the end of the day, what we deliver to our clients needs to wow them.

Colton Pond: 00:25:06

You talk to people that use Amazon, they're like, wow, that was easy.

Colton Pond: 00:25:11

That's pretty cool that Amazon thinks what I might be about

Colton Pond: 00:25:13

to purchase and recommends it.

Colton Pond: 00:25:15

Right?

Colton Pond: 00:25:15

I mean, it's, it's the same thing with Netflix.

Colton Pond: 00:25:18

I said we need to try to do that with banking.

Colton Pond: 00:25:21

And you two both know that's an incredible challenge.

Colton Pond: 00:25:25

An incredible challenge.

Colton Pond: 00:25:28

Let a, let a loan for a regional bank,

Colton Pond: 00:25:31

right?

Colton Pond: 00:25:32

JP Morgan spends $13 billion per year on technology, and quite

Colton Pond: 00:25:37

frankly, they do a pretty good job, but they still have issues.

Colton Pond: 00:25:41

How can a bank our size.

Colton Pond: 00:25:44

We have soon to be 30 billion in assets.

Colton Pond: 00:25:47

How can we find technology that makes people go, wow.

Colton Pond: 00:25:52

And the only way we can do that is we have to be more nimble.

Colton Pond: 00:25:56

We have to be willing to fail.

Colton Pond: 00:25:58

We have to go with FinTech providers.

Colton Pond: 00:26:00

We have to take risks and build stuff ourself.

Colton Pond: 00:26:04

But the fact of the matter is because we are smaller, we can be more nimble and

Colton Pond: 00:26:09

we can get stuff done and our clients will be more patient with us because it

Colton Pond: 00:26:13

turns out there's a fundamental disdain for the largest banks in this country.

Colton Pond: 00:26:19

So there's, there's a reason people want to bank where

Colton Pond: 00:26:22

they can have a relationship.

Colton Pond: 00:26:23

And if you can be in this sweet spot that I say is big enough to be relevant,

Colton Pond: 00:26:27

small enough to be nimble, I think there's a huge opportunity for us.

Tedd Huff: 00:26:32

Well, and, and Brent, one of, one of the favorite stories that

Tedd Huff: 00:26:35

you told me, I think one of the first times that we met was, you know, I asked

Tedd Huff: 00:26:39

about, well, you wanted to be technology first, a digital financial institution.

Tedd Huff: 00:26:46

What did you start with?

Tedd Huff: 00:26:48

And.

Tedd Huff: 00:26:50

And, and your story of paper ledgers com, like some antiquated machines,

Tedd Huff: 00:26:58

all of those different things, it makes me really think you had a lot to

Tedd Huff: 00:27:05

do to get to where you guys are now.

Tedd Huff: 00:27:08

What do you think that they should be focused on first when you're looking

Tedd Huff: 00:27:13

at a technology to, to move, move the financial institution forward?

Brent Beardall: 00:27:18

Yeah.

Brent Beardall: 00:27:18

So, uh, this is act actually something that Brandon and I came up with together.

Brent Beardall: 00:27:23

Uh, for regional banks.

Brent Beardall: 00:27:25

We call it the Path to Freedom.

Brent Beardall: 00:27:27

I.

Brent Beardall: 00:27:27

Right.

Brent Beardall: 00:27:27

Uh, we, we all feel like our, our, our hands are tied, right?

Brent Beardall: 00:27:31

We are just beholden on whatever our provider is, and, well, we can't do that

Brent Beardall: 00:27:35

because they say if we want to implement a CRM, it will take two and a half years

Brent Beardall: 00:27:39

and project management team and so forth.

Brent Beardall: 00:27:41

So it is what it is and just stick with it.

Brent Beardall: 00:27:44

Right?

Brent Beardall: 00:27:44

Again, just, just ride out what's, what's coming in to me,

Brent Beardall: 00:27:48

So the key for midsize banks is finding that path to freedom because

Brent Beardall: 00:27:53

you're never gonna do it all at once.

Brent Beardall: 00:27:55

And that's why everyone is so reticent to change a core 'cause

Brent Beardall: 00:27:58

there's so much risk involved in it.

Brent Beardall: 00:28:00

How can you find a solution where you are no longer dependent on the

Brent Beardall: 00:28:04

core, but you say, you know what, I'm gonna keep everything on the core.

Brent Beardall: 00:28:07

But I'm gonna go with my online banking preference over what you have.

Brent Beardall: 00:28:11

Or I'm gonna go with a different mobile provider, or I'm gonna go, you name

Brent Beardall: 00:28:14

it, a different payments provider.

Brent Beardall: 00:28:16

That, that is what we've been able to do.

Brent Beardall: 00:28:18

Um, Thanks in large part to our, uh, technology partner that's actually

Brent Beardall: 00:28:23

spin off of Wafd called Archway, that has really allowed us this

Brent Beardall: 00:28:27

middleware layer, uh, that connects our core with, uh, external systems.

Brent Beardall: 00:28:33

And to me that would be the key is say, okay, hey.

Brent Beardall: 00:28:36

What is your biggest pain point?

Brent Beardall: 00:28:38

When, when you talk to your clients, what is your biggest pain point?

Brent Beardall: 00:28:41

And simply solve that pain point.

Brent Beardall: 00:28:44

Don't try to boil the ocean, right?

Brent Beardall: 00:28:46

They, everybody can say, okay, you look at everything holistically.

Brent Beardall: 00:28:49

Well, we need to change these 14 systems.

Brent Beardall: 00:28:52

If you need to change 14 systems, kiss it, goodbye, it's over.

Brent Beardall: 00:28:55

Figure out one, figure out a way to be able to change that one system in a

Brent Beardall: 00:29:00

short timeframe, three to four months.

Brent Beardall: 00:29:03

And then tackle the next one.

Brent Beardall: 00:29:04

And then the other thing that's completely counterintuitive of us is bankers and

Brent Beardall: 00:29:08

accountants, because typically there's a really close, close correlation is

Brent Beardall: 00:29:13

we always think, okay, gonna solve this problem, and you name it, I'm gonna solve

Brent Beardall: 00:29:17

this problem with mobile banking, and as soon as I solve this, then I'm gonna

Brent Beardall: 00:29:20

be able to focus on everything else B.S.

Brent Beardall: 00:29:22

It doesn't work that way,

Brent Beardall: 00:29:24

Amazon doesn't launch a product and then set it, then move on to something else.

Brent Beardall: 00:29:28

They launch the product and what do they do?

Brent Beardall: 00:29:30

They listen and then they iterate.

Brent Beardall: 00:29:33

And so that's technology and banking.

Brent Beardall: 00:29:36

Technology in general is a journey with no destination.

Brent Beardall: 00:29:41

today we have, I think, um.

Brent Beardall: 00:29:43

Like 15 different versions of our website, we try to personalize it.

Brent Beardall: 00:29:47

So when, uh, Colton logs on from Utah, there's good, you know,

Brent Beardall: 00:29:51

views of the ski resorts in Utah.

Brent Beardall: 00:29:53

It's not showing 'em the Puget Sound, right?

Brent Beardall: 00:29:55

Or if somebody logs in, in Dallas, Texas, they're not seeing the Seahawks

Brent Beardall: 00:29:59

stadium in the background, right?

Brent Beardall: 00:30:00

You wanna personalize it, right?

Brent Beardall: 00:30:02

And it's simple things like that.

Brent Beardall: 00:30:04

But they matter.

Brent Beardall: 00:30:05

And so historically, we, we said, okay, we're gonna fix something.

Brent Beardall: 00:30:09

We've got it up and running, and you typically get it up and running with the,

Brent Beardall: 00:30:12

you know, minimal viable product, the MVP, and then, okay, move on to something else.

Brent Beardall: 00:30:17

No, as soon as you get it up and running, start fine tuning it, getting it better.

Colton Pond: 00:30:23

I, I love that.

Colton Pond: 00:30:24

So, Brent, you bring up Path to freedom.

Colton Pond: 00:30:26

Path to freedom is a big reason why I'm at Loan Pro is like how to help

Colton Pond: 00:30:30

financial institutions innovate outside of the handcuffs that they're

Colton Pond: 00:30:33

placed within, uh, legacy providers.

Colton Pond: 00:30:36

I would love to dive in and, and understand some of the innovation that

Colton Pond: 00:30:40

you all have done at WaFd recently and the impact that that's had and, and the

Colton Pond: 00:30:46

journey, some of the key wins you've had.

Tedd Huff: 00:30:48

And a lot of the regional banks are trying to figure out how do they,

Tedd Huff: 00:30:52

how do they move with the technology?

Tedd Huff: 00:30:53

How do they move forward and how do they thrive?

Colton Pond: 00:30:56

One of the things I love is like in talking to your team, I've learned

Colton Pond: 00:30:59

a lot in talking to Archway and Pi Pike Street on stuff you've done with voice

Colton Pond: 00:31:03

activated banking and things like that.

Colton Pond: 00:31:06

Give us some insight into.

Colton Pond: 00:31:08

The ideation process, the development process, the the launch process and the

Colton Pond: 00:31:12

impact that those things have for the bank, and then the iteration process.

Brent Beardall: 00:31:16

Yeah.

Brent Beardall: 00:31:16

So it, it, it always starts with a need, right?

Brent Beardall: 00:31:19

What, what was the need?

Brent Beardall: 00:31:20

And, uh, we had a very, like a 20-year-old, uh, call center, uh,

Brent Beardall: 00:31:26

software system, and more and more people are calling in and, right.

Brent Beardall: 00:31:29

You.

Brent Beardall: 00:31:30

Press one.

Brent Beardall: 00:31:31

If you want to deal with your checking account, press two with the same.

Brent Beardall: 00:31:34

And I mean, it was awful.

Brent Beardall: 00:31:36

This voice tree, this voice response unit.

Brent Beardall: 00:31:38

And so we said, okay, h how, how, how do we get with the modern age?

Brent Beardall: 00:31:42

And we had, uh, Dustin Hubbard, our CTO, who's president of Archway, look into it

Brent Beardall: 00:31:48

and he is like, Brent, really the call center should just be online banking.

Brent Beardall: 00:31:54

Right.

Brent Beardall: 00:31:54

I mean, we, it, it really should be a, just a, a different front

Brent Beardall: 00:31:58

end to be able to access it.

Brent Beardall: 00:32:00

one of the very, very cool things of working with Amazon, we have, uh, all

Brent Beardall: 00:32:04

of our cloud infrastructure at Amazon.

Brent Beardall: 00:32:06

One of the cool things I love about Amazon and they say, we

Brent Beardall: 00:32:10

built all this really cool stuff.

Brent Beardall: 00:32:12

Here's your tool chest.

Brent Beardall: 00:32:14

Go for it.

Brent Beardall: 00:32:15

And so we were able to work with them and basically take their Alexa technology

Brent Beardall: 00:32:22

and put that in, uh, online banking so you can now call in with your voice and

Brent Beardall: 00:32:28

it authenticates you using your voice.

Brent Beardall: 00:32:31

And the even better is the security aspect of it, because it has to

Brent Beardall: 00:32:34

be your voice from your phone

Brent Beardall: 00:32:37

we know AI can duplicate your voice,

Brent Beardall: 00:32:39

so

Tedd Huff: 00:32:39

I was about to ask you that

Tedd Huff: 00:32:41

question.

Tedd Huff: 00:32:42

no, so it's, it's very secure.

Tedd Huff: 00:32:44

It's multifactor authentication, but how cool that when it

Tedd Huff: 00:32:48

calls in, it says hybrid.

Tedd Huff: 00:32:50

How can I help you?

Tedd Huff: 00:32:51

Again, that personalization and then it's, I want my checking account.

Brent Beardall: 00:32:56

What are the last three checks I had paid?

Brent Beardall: 00:32:59

What are the last two deposits?

Brent Beardall: 00:33:00

Whatever you want.

Brent Beardall: 00:33:01

Use plain English and tell, and also we don't hide behind.

Brent Beardall: 00:33:06

You can't speak to somebody.

Brent Beardall: 00:33:08

I wanna speak to my banker.

Brent Beardall: 00:33:09

Great.

Brent Beardall: 00:33:10

We will get you to your banker.

Brent Beardall: 00:33:11

We, we want to enable people to be served how they want to be served.

Brent Beardall: 00:33:15

We don't wanna hide behind call trees.

Brent Beardall: 00:33:17

I,

Colton Pond: 00:33:17

One of the things we're talking about in this podcast series

Colton Pond: 00:33:19

is a long personalization and how to drive personalization and lending.

Colton Pond: 00:33:24

That's a killer example and, and one that use technology in your backyard in Seattle

Brent Beardall: 00:33:28

here's the cool thing.

Brent Beardall: 00:33:30

To my knowledge, there is not another bank in the country that has it.

Brent Beardall: 00:33:34

I, I think Schwab does it on their brokerage accounts.

Brent Beardall: 00:33:37

Other than that, nobody else does it.

Brent Beardall: 00:33:39

And I talk to high net worth individuals all the time, We want deposits.

Brent Beardall: 00:33:44

High net worth individuals have a lot of deposits, right?

Brent Beardall: 00:33:47

I said, what?

Brent Beardall: 00:33:47

What can we do?

Brent Beardall: 00:33:49

What is your biggest pain point with banking?

Brent Beardall: 00:33:52

Number one pain point is wire transfers.

Brent Beardall: 00:33:54

So then the next thing I said, okay, let's build out wire

Brent Beardall: 00:33:57

transfers in online banking.

Brent Beardall: 00:33:59

And once you submit your online banking,

Brent Beardall: 00:34:01

Colton is gonna pay, uh, Tedd you know, $5,000.

Brent Beardall: 00:34:05

All of a sudden the system will call him back and says, Colton, we

Brent Beardall: 00:34:08

wanna review this wire transfer.

Brent Beardall: 00:34:09

Please authorize this with your voice, and then your wire transfer is sent.

Brent Beardall: 00:34:15

How stinking cool is that?

Tedd Huff: 00:34:17

That's really

Brent Beardall: 00:34:18

and literally it's a, wow.

Brent Beardall: 00:34:20

I get clients that talk to their friends neighbors about it at cocktail parties.

Brent Beardall: 00:34:25

What,

Tedd Huff: 00:34:27

talking about sending a wire.

Tedd Huff: 00:34:29

That's, that's crazy.

Brent Beardall: 00:34:30

but, why?

Brent Beardall: 00:34:31

Why do they do it?

Brent Beardall: 00:34:32

Because they know it's a pain for everybody.

Tedd Huff: 00:34:34

Yeah.

Tedd Huff: 00:34:35

What are you seeing from, from your bank?

Tedd Huff: 00:34:40

The biggest challenges that are going on in the lending landscape, and how are you

Tedd Huff: 00:34:46

leveraging the technology to combat it?

Brent Beardall: 00:34:48

the biggest challenges we and most everyone

Brent Beardall: 00:34:52

have in lending right now.

Brent Beardall: 00:34:54

Is the lack of availability because repayments have slowed down so much,

Brent Beardall: 00:34:58

a year and a half ago we generated about eight and a half

Brent Beardall: 00:35:01

billion of new loans, right?

Brent Beardall: 00:35:03

So we were on this pace where we can make eight and a half billion each year.

Brent Beardall: 00:35:06

Let's go to 9 billion, let's go to 10 billion and the highest quality

Brent Beardall: 00:35:09

loans, we put the technology in place.

Brent Beardall: 00:35:11

It was really good process.

Brent Beardall: 00:35:12

Then all of a sudden, repayments slowed way down.

Brent Beardall: 00:35:15

Repayments came down like 60, 70%.

Brent Beardall: 00:35:18

'cause it turns out nobody wants to prepay their three and a half percent

Brent Beardall: 00:35:21

mortgage and go get a 7% mortgage.

Brent Beardall: 00:35:23

Imagine that.

Brent Beardall: 00:35:24

So it, it's, it's finding is the biggest challenge right now in

Brent Beardall: 00:35:28

terms of finding the capacity.

Brent Beardall: 00:35:31

One of my personal pet peeves is you go through and put all this information in,

Brent Beardall: 00:35:35

then it finally routes you to somebody 10 minutes later and, well, can I

Brent Beardall: 00:35:39

start with your social security number?

Brent Beardall: 00:35:41

You're like, are you kidding me?

Brent Beardall: 00:35:42

Don't do that to me.

Brent Beardall: 00:35:44

Right.

Brent Beardall: 00:35:44

No.

Brent Beardall: 00:35:45

Everything, it, it goes over, they can see exactly.

Brent Beardall: 00:35:48

They, they pull up a page that shows your last transactions.

Brent Beardall: 00:35:51

It shows where you've logged on from.

Brent Beardall: 00:35:54

It shows how long you've been a customer at ed, what kinda

Brent Beardall: 00:35:57

loans, what kind of deposits.

Brent Beardall: 00:35:58

It's that CRM holistic view.

Brent Beardall: 00:36:01

So we can say, great, Tedd thank you for being a customer with this for 15 years.

Brent Beardall: 00:36:06

I can see you've been having trouble with your online banking.

Brent Beardall: 00:36:09

Is that what this call about?

Brent Beardall: 00:36:10

Right?

Brent Beardall: 00:36:11

It turns out if you actually pay attention to what you know about your customers,

Brent Beardall: 00:36:16

you're gonna create raving fans.

Brent Beardall: 00:36:17

I.

Brent Beardall: 00:36:19

that, that, that's, that's just a temporary problem, right?

Brent Beardall: 00:36:21

Because rates will come down and, and we will start up again.

Brent Beardall: 00:36:24

But in terms of lending technology, it's still never ceases to amaze me

Brent Beardall: 00:36:30

how we treat 20 year clients like they're brand new clients to us.

Brent Beardall: 00:36:35

we have all the information about them,

Brent Beardall: 00:36:37

but you know, Tedd you come in and say, I want, want a new loan with Wafd.

Brent Beardall: 00:36:40

Fantastic.

Brent Beardall: 00:36:42

Here's a fancy, what's essentially a PDF form for you to fill out

Brent Beardall: 00:36:46

to tell us everything you want in the loan in today's day and age.

Brent Beardall: 00:36:49

Are you kidding me?

Brent Beardall: 00:36:50

We need to have the answers to say, that's fantastic, Tedd Here are

Brent Beardall: 00:36:54

the three different loan offers we think will be best for you.

Brent Beardall: 00:36:57

What do you think?

Tedd Huff: 00:37:00

Yeah.

Brent Beardall: 00:37:01

It, it's, it doesn't seem like a lot to ask.

Brent Beardall: 00:37:04

Nobody has it today.

Tedd Huff: 00:37:07

Why do you think that

Brent Beardall: 00:37:09

the the reason for it is the antiquated tech stack

Brent Beardall: 00:37:13

and the silos of information.

Brent Beardall: 00:37:15

Right, Norma,

Brent Beardall: 00:37:16

normally you have an origination system that stands on its own.

Brent Beardall: 00:37:20

You have a servicing system that stands on its own, a core system that

Brent Beardall: 00:37:23

stands on its own, the depository.

Brent Beardall: 00:37:25

Right.

Brent Beardall: 00:37:26

And if you have a financial aggregator that stands by, its you need something to

Brent Beardall: 00:37:29

be able to look across all the different silos and say, this is everything we

Brent Beardall: 00:37:33

know about Tedd It turns out he's an A plus credit risk, whatever he wants.

Brent Beardall: 00:37:37

Let's do.

Tedd Huff: 00:37:39

So it almost sounds like, you know, the, the desire to not have

Tedd Huff: 00:37:43

everything in a single core to be able to give you the flexibility you want

Tedd Huff: 00:37:47

also is one of the things that causes some of the friction for your customers.

Brent Beardall: 00:37:53

I, no, I think historically that's the way it was, but I

Brent Beardall: 00:37:57

think if you can get that out in the cloud and you can access the information in the

Brent Beardall: 00:38:02

different cores and bring it together, I, I, I think you, It lack of flexibility,

Brent Beardall: 00:38:09

the lack of API integration is what's killed the legacy systems, but Right.

Brent Beardall: 00:38:14

I, I don't care if it's in 15 different system, if it's all in

Brent Beardall: 00:38:19

the cloud environment I've built and we can access all that information

Brent Beardall: 00:38:23

and it's not just the information.

Brent Beardall: 00:38:25

That we really, the a plus information about Colton that we wanna know.

Brent Beardall: 00:38:29

We also wanna know how often has he gone to our website,

Brent Beardall: 00:38:33

areas of our website, right?

Brent Beardall: 00:38:35

It turns out if he's looking at the home equity loan, right?

Brent Beardall: 00:38:39

Maybe the next time he comes, we should suggest here's a home

Brent Beardall: 00:38:41

equity loan we have for you.

Brent Beardall: 00:38:43

, oh, by the way, if all of a sudden his purchases at Home Depot have gone up,

Brent Beardall: 00:38:48

you know, to $5,000 every other month.

Brent Beardall: 00:38:50

Well, maybe we look at a, a home improvement loan or

Brent Beardall: 00:38:53

something for 'em, right?

Brent Beardall: 00:38:54

We we're not paying attention to what's happening in different areas of the bank.

Brent Beardall: 00:38:58

That impact we need to look at Colton holistically.

Colton Pond: 00:39:01

So, so I think one of the aspects you're highlighting there is Brent

Colton Pond: 00:39:04

bringing all your data into one spot.

Colton Pond: 00:39:07

And that involves, I love that you highlight like market everything

Colton Pond: 00:39:10

from marketing data to financial transaction data to credit data,

Colton Pond: 00:39:13

all of the data within one spot.

Colton Pond: 00:39:15

Because if you think about banks, uh, banks have the most data about a customer.

Colton Pond: 00:39:20

They have data that even Amazon and Netflix and Walmart

Colton Pond: 00:39:23

want financial data, right?

Colton Pond: 00:39:25

You know, all of their transactions where their, uh, what their spending

Colton Pond: 00:39:29

habits are, all of their data.

Colton Pond: 00:39:31

And there's a lot that you can do with personalizing your approach

Colton Pond: 00:39:34

on lending products to offer.

Colton Pond: 00:39:36

On our side where Loan Pro focuses on how do you service more efficiently,

Colton Pond: 00:39:40

what I'd love to do is dive a little bit deeper into how you all, how the broader

Colton Pond: 00:39:48

challenges in the lending ecosystem influence WaFd's strategic priorities.

Brent Beardall: 00:39:51

Yeah, yeah, yeah.

Brent Beardall: 00:39:52

you're gonna get me going on this, Colton, and, and you know this,

Brent Beardall: 00:39:55

know me well enough to know I've got a couple of lending ideas that I

Brent Beardall: 00:39:58

think are 10 and $20 billion ideas.

Brent Beardall: 00:40:01

I,

Brent Beardall: 00:40:02

do.

Brent Beardall: 00:40:02

But we also have to be strategic, right?

Brent Beardall: 00:40:05

As I said, right now, it's a capacity issue, right?

Brent Beardall: 00:40:08

It's, it's a deposit issue.

Brent Beardall: 00:40:09

How, the biggest question, and this is one of the harsh realities for regional banks.

Brent Beardall: 00:40:15

Is the assets will come and go.

Brent Beardall: 00:40:17

The quality matters, but the assets will come and go.

Brent Beardall: 00:40:19

The real differentiator for regional banks is how are you going to fund

Brent Beardall: 00:40:23

those deposit or those assets?

Brent Beardall: 00:40:25

Are you gonna be able to fund those with low cost sticky deposits, or

Brent Beardall: 00:40:29

are you gonna fund those with high cost borrowings or high cost CDs?

Brent Beardall: 00:40:33

So that's the question.

Brent Beardall: 00:40:34

And especially in today's day and age after last spring, everybody is

Brent Beardall: 00:40:37

hyper-focused on deposits, but you never know what's going to happen.

Brent Beardall: 00:40:42

I, I like to tell people all the time.

Brent Beardall: 00:40:44

Things so changed so quickly.

Brent Beardall: 00:40:46

We are so hyper-focused on the now, right?

Brent Beardall: 00:40:49

Everybody's focused on deposits.

Brent Beardall: 00:40:50

Now, I, I take everybody back to remember, March of 2020,

Colton Pond: 00:40:54

oh, everyone was flush with deposits.

Brent Beardall: 00:40:57

well flush with deposits in every single investor conference I

Brent Beardall: 00:41:01

went to every news media interview I had.

Brent Beardall: 00:41:04

Brent, talk to me about your hotel exposure.

Brent Beardall: 00:41:06

I mean, ed, you, you guys have.

Brent Beardall: 00:41:09

Like $900 million of hotel exposure.

Brent Beardall: 00:41:12

Nobody's going to hotels.

Brent Beardall: 00:41:14

I mean, these things, I, I, I fire sell these things, get rid of these things,

Brent Beardall: 00:41:19

and I'm like, pause, take a time out.

Tedd Huff: 00:41:22

Breathe, breathe.

Brent Beardall: 00:41:24

Yeah.

Brent Beardall: 00:41:24

exactly.

Brent Beardall: 00:41:25

The sky is not falling.

Brent Beardall: 00:41:28

a second.

Brent Beardall: 00:41:28

Right In this moment, hotels are bad 'cause nobody's going.

Brent Beardall: 00:41:34

But this moment will pass.

Brent Beardall: 00:41:36

Now fast forward to today.

Brent Beardall: 00:41:37

What's happened?

Brent Beardall: 00:41:39

Hotels are golden because the profitability is through the roof.

Brent Beardall: 00:41:45

They offer less services and they charge you more.

Brent Beardall: 00:41:48

Literally, the average

Colton Pond: 00:41:50

yeah.

Brent Beardall: 00:41:51

is up 25% where it was pre pandemic that we bank.

Brent Beardall: 00:41:56

Right.

Brent Beardall: 00:41:57

So let's, let's not hyperfocus on the, now let's have the longer term approach.

Brent Beardall: 00:42:03

No.

Brent Beardall: 00:42:03

Knowing that cycles will happen.

Brent Beardall: 00:42:05

So I, I'm, I'm excited about, uh, what some of those lending possibilities

Brent Beardall: 00:42:09

can be for us in the future.

Colton Pond: 00:42:10

Yeah.

Colton Pond: 00:42:11

And then I was gonna say, so now you have people and I watch your CNBC article or

Colton Pond: 00:42:15

CN news clip on commercial real estate.

Colton Pond: 00:42:18

You know, people say the world is falling when it comes to commercial real

Colton Pond: 00:42:20

estate, which is not always the case.

Colton Pond: 00:42:22

Uh, you go listen to Brent's uh, uh, uh, recording on CNBC.

Colton Pond: 00:42:26

It was really good.

Brent Beardall: 00:42:28

Yeah, I, I, I, I can't let that go without saying For

Brent Beardall: 00:42:31

people worried about commercial real estate, ask yourself three questions.

Brent Beardall: 00:42:35

What kind of commercial real estate you have to understand the

Brent Beardall: 00:42:37

segments of commercial real estate.

Brent Beardall: 00:42:39

I.

Brent Beardall: 00:42:40

Number two, understand the markets they're in.

Brent Beardall: 00:42:43

Real estate is local.

Brent Beardall: 00:42:44

Are you talking about real estate in downtown Manhattan or are you talking

Brent Beardall: 00:42:48

about real estate in Boise, Idaho?

Brent Beardall: 00:42:49

Very, very different.

Brent Beardall: 00:42:50

And then number three, you have to understand how much

Brent Beardall: 00:42:52

equity the borrower has in it.

Brent Beardall: 00:42:54

If you understand those three characteristics about the commercial

Brent Beardall: 00:42:57

real estate, you can understand pretty well how much credit risk there is.

Tedd Huff: 00:43:02

So when I look at that, it, it all opens up a number of

Tedd Huff: 00:43:07

different opportunities around these different lending servers.

Tedd Huff: 00:43:10

You talk about the.

Tedd Huff: 00:43:12

The sky's following piece of it that we were talking about with the

Tedd Huff: 00:43:14

commercial, commercial real estate.

Tedd Huff: 00:43:17

What other opportunities, or what opportunities are you seeing for lending

Tedd Huff: 00:43:22

services around maybe data analytics, customer service, customization?

Tedd Huff: 00:43:27

How do you make it more efficient?

Tedd Huff: 00:43:28

I know we kind of touched on it, but I'd like to get a little

Tedd Huff: 00:43:31

bit specific in that area.

Brent Beardall: 00:43:33

Yeah, no, there, there's all kinds of opportunities.

Brent Beardall: 00:43:36

Colton mentioned a few, right?

Brent Beardall: 00:43:38

We're likely gonna go through some economic stress, right?

Brent Beardall: 00:43:42

Do not treat everyone the same, understand the fundamentals of what's happening.

Brent Beardall: 00:43:48

And as a banking, banking industry, we are terrible.

Brent Beardall: 00:43:52

We typically force people to make the hardest decisions

Brent Beardall: 00:43:55

in the worst possible time.

Brent Beardall: 00:43:57

What can we do to utilize data, to utilize analytics, to understand what can we do

Brent Beardall: 00:44:03

to give Tedd more time to pay us back?

Brent Beardall: 00:44:07

Because the vast majority of Tedd's in the world, they want to pay you

Colton Pond: 00:44:11

mm-Hmm.

Brent Beardall: 00:44:12

If you give them the option, if you

Brent Beardall: 00:44:14

give them the chance to pay them back.

Brent Beardall: 00:44:16

so many of us as banks, nope.

Brent Beardall: 00:44:18

You signed the paperwork.

Brent Beardall: 00:44:19

Either you pay us back or by, damn.

Brent Beardall: 00:44:21

You're gonna learn the lesson.

Brent Beardall: 00:44:22

I'm gonna foreclose on you,

Brent Beardall: 00:44:24

Stop.

Brent Beardall: 00:44:25

As soon as we foreclosed as a bank, there's another 20 to 30% discount of the

Brent Beardall: 00:44:30

value When somebody sees a bank owns it.

Brent Beardall: 00:44:32

Because they say, oh, I can take advantage of the bank.

Brent Beardall: 00:44:35

What can we do, Tedd to help you get back on your feet?

Brent Beardall: 00:44:38

we take three months of payments and capitalize it and then help you get right?

Brent Beardall: 00:44:43

what are the things we can do to work with you now?

Brent Beardall: 00:44:46

You need to be willing, well, I, I'm not gonna do that for you if I think you're a

Brent Beardall: 00:44:49

strategic falter, but if you're, if you're genuinely having a hard time and you're.

Brent Beardall: 00:44:54

Busting your tail to work through it.

Brent Beardall: 00:44:56

What can we do to help you?

Brent Beardall: 00:44:58

And that's one of the great learnings of the pandemic is banks stopped taking

Brent Beardall: 00:45:02

such a hard line that we took in oh eight and oh nine and we started working

Brent Beardall: 00:45:06

with people and it's one of the reasons things worked out pretty darn well.

Brent Beardall: 00:45:10

so I think we need to build in flexibility in terms of how we service loans.

Brent Beardall: 00:45:16

And it's one of the reasons that Colton and I got to, uh, talk

Brent Beardall: 00:45:19

about Loan Pro is Loan Pro provides that kind of flexibility for you.

Brent Beardall: 00:45:24

So, okay, hey, we understand you don't wanna treat all the clients the same.

Brent Beardall: 00:45:29

Let's give 'em some options and here's what options would look like and here's

Brent Beardall: 00:45:32

what a servicing system that could support those options could look like.

Colton Pond: 00:45:36

Yeah, on, on that note, actually, uh, a few weeks ago

Colton Pond: 00:45:39

I got the, uh, ability to be able to go to one of our customers and

Colton Pond: 00:45:44

watch frontline agent service loans.

Colton Pond: 00:45:46

And one of the examples was someone called in and said, Hey, um, so I just

Colton Pond: 00:45:51

lost my job, but I found a new job and I'm going to, uh, get paid in in a month.

Colton Pond: 00:45:57

I, I know I have a pay payment in two weeks.

Colton Pond: 00:45:59

Can we move that back two weeks?

Colton Pond: 00:46:01

And the servicing agent was like, uh, uh, one second.

Colton Pond: 00:46:03

Let me check.

Colton Pond: 00:46:04

Check the, uh, check the rules.

Colton Pond: 00:46:06

Said, oh, is this within compliance and rules?

Colton Pond: 00:46:08

It was hit done.

Colton Pond: 00:46:09

And said, okay, yeah, that's taken care of.

Colton Pond: 00:46:11

She's like, oh, no.

Colton Pond: 00:46:12

Do you have to go talk to someone?

Colton Pond: 00:46:13

And, and she was like, no, it's already done.

Colton Pond: 00:46:15

You're good.

Colton Pond: 00:46:16

Your payment's now due on the 30th of the month.

Colton Pond: 00:46:18

And delightful experiences like that mean a lot,

Colton Pond: 00:46:21

It turns lending from a transactional for a long time, lending has

Colton Pond: 00:46:25

been a transactional business.

Colton Pond: 00:46:26

It's like, I give you money, you pay me back.

Colton Pond: 00:46:28

If not, I'm gonna take your assets right In the end, what it needs to do.

Colton Pond: 00:46:32

And Wafd has done a really good job here, Brent is turning it

Colton Pond: 00:46:35

into a relationship, right?

Colton Pond: 00:46:38

And it doesn't need to be a transaction.

Colton Pond: 00:46:39

It needs to be a relationship of you and I working together on,

Colton Pond: 00:46:43

on terms that we've agreed to.

Brent Beardall: 00:46:45

No, and that's exactly right.

Brent Beardall: 00:46:46

And, and when you can successfully do that, price doesn't become

Brent Beardall: 00:46:50

the primary differentiator.

Brent Beardall: 00:46:52

Someone will pay a little bit more in price if they

Brent Beardall: 00:46:55

believe the bank has your back.

Brent Beardall: 00:46:57

Uh, that's foundational to what I believe.

Colton Pond: 00:47:00

You talked about this idea of evaluating the market, seeing what pains

Colton Pond: 00:47:05

there are, prioritizing that, going and innovating by having this middleware layer

Colton Pond: 00:47:09

that allows you to actually innovate and not be beholden, the legacy technology.

Colton Pond: 00:47:13

But then one of the biggest things that you talked about that we didn't

Colton Pond: 00:47:16

drill into is this iter of innovation, launching something, testing,

Colton Pond: 00:47:21

finding feedback, doing it again.

Colton Pond: 00:47:23

How do you fix that loop and what does that process look like and how

Colton Pond: 00:47:26

do you make sure that you're getting feedback from customers back and

Colton Pond: 00:47:29

back into the development cycle to constantly improve new products?

Brent Beardall: 00:47:33

That feedback loop is very important.

Brent Beardall: 00:47:36

I, I find that too often we inundate ourself with so much feedback.

Brent Beardall: 00:47:40

We're overwhelmed with it,

Brent Beardall: 00:47:43

I personally hate.

Brent Beardall: 00:47:45

Surveys, Hate surveys.

Brent Beardall: 00:47:47

I, I hate internal surveys.

Brent Beardall: 00:47:49

I hate customer surveys, right?

Brent Beardall: 00:47:52

I mean, it's like banking for a compliment.

Brent Beardall: 00:47:54

Oh, of course.

Brent Beardall: 00:47:55

I'm gonna tell you.

Brent Beardall: 00:47:55

Right?

Brent Beardall: 00:47:57

and be careful.

Brent Beardall: 00:47:57

If you ask for information, they give you information, then

Brent Beardall: 00:48:01

you don't do something with it.

Colton Pond: 00:48:02

You're in trouble.

Brent Beardall: 00:48:03

What you're telling people, you don't care about it.

Brent Beardall: 00:48:05

Right?

Brent Beardall: 00:48:05

It's, it's a waste of time.

Brent Beardall: 00:48:07

My, my next pet peeve is employee evals, right?

Brent Beardall: 00:48:11

Uh, we, we got rid of employee evals at WaFd.

Brent Beardall: 00:48:14

If our employees don't understand how their manager feels about 'em,

Brent Beardall: 00:48:17

that's shame on the manager, right?

Brent Beardall: 00:48:19

Why do something just to do something?

Brent Beardall: 00:48:21

So my point is, how do you get that feedback?

Brent Beardall: 00:48:25

I want it firsthand.

Brent Beardall: 00:48:26

I want our employees to be customers.

Colton Pond: 00:48:29

Hmm.

Brent Beardall: 00:48:29

Say, Hey, you just went and opened an account online.

Brent Beardall: 00:48:31

How was it?

Brent Beardall: 00:48:33

It sucked.

Brent Beardall: 00:48:34

fix it.

Colton Pond: 00:48:35

Yeah.

Brent Beardall: 00:48:36

I, I want to be out talking to our clients.

Brent Beardall: 00:48:39

Okay.

Brent Beardall: 00:48:39

What did you just do with us?

Brent Beardall: 00:48:40

How was it?

Brent Beardall: 00:48:42

And it turns out there is so much information there available to us.

Brent Beardall: 00:48:46

You don't have to run a massive campaign and let's make sure

Brent Beardall: 00:48:49

that it's statistically relevant.

Brent Beardall: 00:48:51

bs I mean, you certainly can do that.

Brent Beardall: 00:48:54

I, I wouldn't, you know, from my perspective, you don't need to, The

Brent Beardall: 00:48:58

information is there staring us at the, in the face if we simply ask the

Brent Beardall: 00:49:02

question of our employees that use it and of our clients that we're listening.

Brent Beardall: 00:49:07

One of the things that turned me on to MX back in the day.

Brent Beardall: 00:49:09

They used to have a team that did nothing but search the Apple store

Brent Beardall: 00:49:13

reviews, and if there were negative reviews, they would say, I'm so sorry.

Brent Beardall: 00:49:17

Hey, we've taken that under advisement.

Brent Beardall: 00:49:18

Then two days later, hey, we launched a new version.

Brent Beardall: 00:49:21

How do you think of it now?

Brent Beardall: 00:49:22

Right.

Brent Beardall: 00:49:23

That's awesome.

Colton Pond: 00:49:25

I love that.

Tedd Huff: 00:49:26

Immediate feedback that.

Tedd Huff: 00:49:28

making it as short as possible and then also just not letting it fall off to

Tedd Huff: 00:49:33

the side is, is really, really huge.

Tedd Huff: 00:49:36

One of the things that Colton brought up that I'd like to kind of understand

Tedd Huff: 00:49:40

is like, how do you prioritize that that feedback as it comes in?

Tedd Huff: 00:49:44

How do you determine like which is the most important to,

Tedd Huff: 00:49:48

to deliver to your customers

Brent Beardall: 00:49:50

Yeah.

Brent Beardall: 00:49:50

And, and quite frankly, that's a job of leadership.

Brent Beardall: 00:49:52

First before you go seek, what else are you gonna do?

Brent Beardall: 00:49:55

You need to get done what's on your plate now, right?

Brent Beardall: 00:49:58

We are notorious of it in banking.

Brent Beardall: 00:50:00

Hey, let, let's, let's start thinking about the next project before we've

Brent Beardall: 00:50:05

even finished the one at hand, right?

Brent Beardall: 00:50:07

And then it turns out the one you have at hand is gonna to be

Brent Beardall: 00:50:10

the minimal viable product and.

Brent Beardall: 00:50:12

Then everybody's right, no, let's, let's set targets.

Brent Beardall: 00:50:16

What are we into?

Brent Beardall: 00:50:16

Once we get there, then let's start something else.

Brent Beardall: 00:50:19

And frankly, what we do is we sit around as a management team and

Brent Beardall: 00:50:23

say, Hey, here's what I'm hearing and seeing from my feedback.

Brent Beardall: 00:50:27

And then we prioritize, okay?

Brent Beardall: 00:50:28

We say, well, this is what we want to do.

Brent Beardall: 00:50:30

it's an iterative process all the time.

Brent Beardall: 00:50:32

Then we communicate that with the board and we say, Hey,

Brent Beardall: 00:50:34

here's, here's our initiatives.

Brent Beardall: 00:50:36

Here's what we're gonna tackle, because you're not gonna boil the ocean, right?

Brent Beardall: 00:50:39

And you, you have to be willing to say, you know what?

Brent Beardall: 00:50:42

fixed asset accounting system sucks, and I don't care.

Brent Beardall: 00:50:46

It's gonna suck forever, and it's okay because that adds no value.

Brent Beardall: 00:50:50

I'm not gonna create raving fans by having a really cool

Brent Beardall: 00:50:52

fixed asset accounting system.

Brent Beardall: 00:50:54

It doesn't matter.

Tedd Huff: 00:50:55

One of the things that, that I, I listened to you go through this

Tedd Huff: 00:50:58

and you talk about the prioritization, you talk about the technology, the

Tedd Huff: 00:51:02

fact that you were thinking so early on about where you were going to

Tedd Huff: 00:51:06

take the bank to be a digital bank.

Tedd Huff: 00:51:09

I'd love for you to pull out your crystal ball or what, whatever you use and,

Tedd Huff: 00:51:15

and kind of enlighten us to what future trends do you see in lending and banking?

Tedd Huff: 00:51:21

Is it ai?

Tedd Huff: 00:51:22

Does that have a potential?

Tedd Huff: 00:51:24

What, what are we gonna be able to do to add some human touch?

Tedd Huff: 00:51:26

What, what are your thoughts for the future of banking and lending?

Brent Beardall: 00:51:29

One of the things that I, I get nervous about, that everybody's

Brent Beardall: 00:51:32

excited about is AI in the, uh, automated adjudication, uh, which obviously

Brent Beardall: 00:51:38

makes all the sense in the world.

Brent Beardall: 00:51:39

Hey, I.

Brent Beardall: 00:51:40

Give me these 52 data points and we're gonna make the best decision possible.

Brent Beardall: 00:51:44

That being said, I proceed with caution.

Brent Beardall: 00:51:47

I think we're all gonna go down that route and we're gonna get

Brent Beardall: 00:51:49

our hands, uh, slapped pretty good by the regulators because Okay.

Brent Beardall: 00:51:53

What data are you using and how are you making sure.

Brent Beardall: 00:51:56

That, that's unbiased data.

Brent Beardall: 00:51:58

Right.

Brent Beardall: 00:51:58

And how does that, uh, you, you look at the desperate impact

Brent Beardall: 00:52:02

of potential data, right?

Brent Beardall: 00:52:04

Just like, Hey, we all use credit scores.

Brent Beardall: 00:52:07

Well, it turns out the credit scores might be biased in one way, shape, or form.

Brent Beardall: 00:52:10

So I, I'm not there will be improvements there, but that,

Brent Beardall: 00:52:15

that's not what I'm betting on.

Brent Beardall: 00:52:17

Uh, I, I really think we need to just look around and say,

Brent Beardall: 00:52:20

okay, what are our bankers doing?

Brent Beardall: 00:52:23

That are just absolute, um, mundane tasks, and how can we automate those tasks?

Brent Beardall: 00:52:30

So how can we empower those bankers to reach out and have

Brent Beardall: 00:52:32

a relationship with Colton?

Brent Beardall: 00:52:34

How can we right, allow them to build those relationships?

Brent Beardall: 00:52:39

Because I do believe that you wanna be a digital first bank.

Brent Beardall: 00:52:42

I think 98% of the banking transactions will be digital.

Brent Beardall: 00:52:46

They'll figure 'em out.

Brent Beardall: 00:52:48

But you differentiate yourself by having a relationship.

Brent Beardall: 00:52:52

Where Tedd you're happy to call, uh, Colton and say, Hey, you know what, I'm,

Brent Beardall: 00:52:56

I'm thinking about selling my business.

Brent Beardall: 00:52:58

What do you think I should do?

Brent Beardall: 00:52:59

Right?

Brent Beardall: 00:53:00

Just having someone you can reach out to and talk to and financial literacy

Brent Beardall: 00:53:04

in the US sucks people are embarrassed.

Brent Beardall: 00:53:07

They're ashamed about it.

Brent Beardall: 00:53:09

Wouldn't it be cruel if they and I, I believe this, deserves a banker.

Brent Beardall: 00:53:16

A banker, they can trust a banker that isn't out to get them into

Brent Beardall: 00:53:20

whatever product they can do so the banker can move their bonus

Brent Beardall: 00:53:22

and earn their bonus and move on.

Brent Beardall: 00:53:24

But a banker that's really looking out for your best interests and they're not

Brent Beardall: 00:53:28

mutually exclusive, you can have both.

Colton Pond: 00:53:31

I, I love that.

Colton Pond: 00:53:32

So in closing, you talked about, hey, balance it.

Colton Pond: 00:53:35

And I always think that this is the right thing and the right message to give.

Colton Pond: 00:53:39

Balance it with compliance.

Colton Pond: 00:53:41

You as a bank can't just like go and just innovate and innovate and innovate

Colton Pond: 00:53:45

and not think about the compliance arm.

Colton Pond: 00:53:47

These two go together.

Colton Pond: 00:53:48

We see a lot of instances in where banks overweight, compliance and

Colton Pond: 00:53:52

underweight innovation and, and somewhere folks have overrated

Colton Pond: 00:53:55

innovation at the expense of compliance.

Colton Pond: 00:53:57

Those two need to

Colton Pond: 00:53:58

work seamlessly together.

Brent Beardall: 00:54:00

What's hard is you, you're, you're trying to

Brent Beardall: 00:54:02

skate to where the puck's going to

Brent Beardall: 00:54:04

Right?

Brent Beardall: 00:54:05

And, and that's, that's hard.

Brent Beardall: 00:54:06

And again, you can't be afraid to fail.

Brent Beardall: 00:54:08

Uh, so, right, that, that's just one area that I'm really nervous about,

Brent Beardall: 00:54:12

we saw some of these lawsuits against Microsoft or their generative AI and

Brent Beardall: 00:54:16

the New York Times, well, wait a second.

Brent Beardall: 00:54:18

You're using our content to create all of this stuff, right?

Brent Beardall: 00:54:21

So there, there's so much yet to play out in, in that space.

Brent Beardall: 00:54:25

So.

Brent Beardall: 00:54:25

It's something I think we just need to be cautious of.

Tedd Huff: 00:54:28

Well, and just the other day there was a.

Tedd Huff: 00:54:31

A letter written by the SEC where they talked about their fear of everything

Tedd Huff: 00:54:36

being AI washed and not being able to understand what it actually

Tedd Huff: 00:54:41

does, what benefit it actually is providing, what is it actually doing?

Tedd Huff: 00:54:46

The whole actual piece is the, is what they kept repeating

Tedd Huff: 00:54:51

over and over and over again.

Tedd Huff: 00:54:53

And I think that's, that's something that no matter what industry you're in, if

Tedd Huff: 00:54:58

you're looking at leveraging any form of.

Tedd Huff: 00:55:00

artificial intelligence, you've, you've got to really understand what is it

Tedd Huff: 00:55:04

doing and how is actually helping?

Brent Beardall: 00:55:08

Yep.

Brent Beardall: 00:55:09

and, and, and what is the data source that using the

Brent Beardall: 00:55:13

maintenance

Tedd Huff: 00:55:14

Oh, that, that's, that's even more important.

Colton Pond: 00:55:16

Yeah.

Tedd Huff: 00:55:17

So I wanna thank you, Brent.

Tedd Huff: 00:55:19

You've, you've been a fabulous guest.

Tedd Huff: 00:55:22

You've brought the passion that is undeniable to, to the discussion.

Tedd Huff: 00:55:27

You know, I really appreciate that.

Tedd Huff: 00:55:29

And the couple things that I took away today was, um, empower your team.

Tedd Huff: 00:55:34

Understand that, that you're gonna have to give up some control to

Tedd Huff: 00:55:38

get that, that movement forward.

Tedd Huff: 00:55:41

Um, I love the piece from you where you were really talking about the transparency

Tedd Huff: 00:55:47

and the honesty when it comes to that.

Tedd Huff: 00:55:50

Uh, a perfect example was when you just recently mentioned the annual review

Tedd Huff: 00:55:55

process has been eliminated, that it gives me chills thinking about that because

Tedd Huff: 00:56:00

that was my most disliked thing to do as a leader and to have as an employee.

Tedd Huff: 00:56:05

That's the worst things that I'd ever had.

Tedd Huff: 00:56:08

But lastly, from?

Tedd Huff: 00:56:09

my perspective, and I'll hand it off to Colton, to kind of

Tedd Huff: 00:56:12

him, to recap his thoughts.

Tedd Huff: 00:56:15

But I love the fact that you're looking at, let's find the technology that

Tedd Huff: 00:56:19

solves the problem so that we can move things forward and delight our customers.

Tedd Huff: 00:56:26

It's not about how can I keep it the least expensive and meet the minimum

Tedd Huff: 00:56:30

viable acceptance of of my, of my base, and that means a lot to me and I

Tedd Huff: 00:56:35

really appreciate hearing you say that.

Brent Beardall: 00:56:37

Thank you.

Colton Pond: 00:56:38

Yeah, Brent, I, I appreciate the time.

Colton Pond: 00:56:40

I love you like a brother, man.

Colton Pond: 00:56:42

Uh, and if I, one aspect that is always so incredible and every time

Colton Pond: 00:56:48

we interact I'm like, man, I come away with a better understanding of this.

Colton Pond: 00:56:51

It's that life is beautiful.

Colton Pond: 00:56:52

It is so beautiful.

Colton Pond: 00:56:54

And the more that.

Colton Pond: 00:56:55

All of members of the leadership team and all of your employees feel that way

Colton Pond: 00:57:01

and are passionate about driving forward outcomes and objectives that help the,

Colton Pond: 00:57:06

the customers that you serve, the better.

Colton Pond: 00:57:09

Um, and I think that's, if, if you were to bundle up the secret sauce

Colton Pond: 00:57:12

of offed, that's a big part of the secret sauce is the team that you

Colton Pond: 00:57:15

built and the culture you built there.

Colton Pond: 00:57:17

Uh, because it, it shows through in all aspects of what y'all do.

Brent Beardall: 00:57:21

Well, well, gentlemen, thank you both for your time.

Brent Beardall: 00:57:23

I've enjoyed the conversation.

Brent Beardall: 00:57:25

Uh, let me just close by saying I'm the luckiest guy in the world.

Brent Beardall: 00:57:28

I, I literally, I, I'll, I'll have that debate with anybody and I think I've,

Brent Beardall: 00:57:32

I've got some pictures that can prove it.

Brent Beardall: 00:57:34

I, I don't, I don't, uh, you know, I shouldn't be here

Brent Beardall: 00:57:38

today, and I'm here today.

Brent Beardall: 00:57:40

I, I wake up and I'm grateful for every day.

Brent Beardall: 00:57:43

life is beautiful.

Brent Beardall: 00:57:45

Uh, even when you ha you've got a crappy day, we're still alive, right?

Brent Beardall: 00:57:49

I perspective is an amazing thing.

Brent Beardall: 00:57:51

I tell people all the time, even if the FDIC showed up tomorrow and said, we're

Brent Beardall: 00:57:54

gonna close down the bank because of X, Y, Z, I would argue with them, I'd tell

Brent Beardall: 00:57:57

'em why they're wrong, because we're one of the strongest banks in the country.

Brent Beardall: 00:58:00

But at the end of the day, I'd hand 'em the keys and say, there you go.

Brent Beardall: 00:58:03

I'm still alive, right?

Brent Beardall: 00:58:05

And, uh, ha having that perspective, uh, is a beautiful perspective.

Brent Beardall: 00:58:10

And it doesn't make you afraid to fail.

Brent Beardall: 00:58:12

Uh, back to your point, Tedd Right?

Brent Beardall: 00:58:14

And we, we have to have that ability, uh, to withstand failure.

Brent Beardall: 00:58:18

And that's, that's how you learn.

Brent Beardall: 00:58:20

That's how you grow.

Brent Beardall: 00:58:21

That's how you get better.

Brent Beardall: 00:58:23

And if, if you want to wow your clients, that means, and occasionally you're gonna.

Brent Beardall: 00:58:27

You're gonna fall flat on your face.

Brent Beardall: 00:58:29

But let me tell you, when you do wow your clients, it is worth every second of it.

Tedd Huff: 00:58:34

Well, and that is another episode of Accrued, a FinTech confidential

Tedd Huff: 00:58:39

series proudly presented by Loan Pro.

Tedd Huff: 00:58:43

Remember, we've, we are launching these every week.

Tedd Huff: 00:58:45

We're bringing on leaders just like Brent to talk about what's going on in

Tedd Huff: 00:58:49

lending, lending, technology, and banking.

Tedd Huff: 00:58:53

As we wrap up today's episode, I've got one last thing for you.

Tedd Huff: 00:58:56

If you're in the trenches fighting fraud and financial crime, you

Tedd Huff: 00:59:00

know it's a complex battlefield.

Tedd Huff: 00:59:02

That's where Hawke's AI tools for real time payment screening, AML,

Tedd Huff: 00:59:07

transaction monitoring, and dynamic customer risk rating come into play.

Tedd Huff: 00:59:12

These aren't just buzzwords, they're game changers designed to make your compliance

Tedd Huff: 00:59:17

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Tedd Huff: 00:59:19

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Tedd Huff: 00:59:24

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Tedd Huff: 00:59:27

Head on over to gethawkai.

Tedd Huff: 00:59:30

com to sign up for a demo and discover how their platform can revolutionize

Tedd Huff: 00:59:35

how you fight fraud and financial crime.

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