Citizens Bank CEO On The Rise Of A Super-Regional Bank

Are you worried about a potential recession? What’s your plan if one were to arise?

Our best guess is that there’s no signs that a recession is imminent. And typically, you would see some excesses popping up in the economy. You’d see some trouble in credit on the consumer side or on the commercial side. And we don’t see any of that.

The consumer is in good shape, in particular, unemployment is at historic lows. There’s real wage growth, salary increases is 3.2% and inflation is only at 1.5%. The consumer feels good. They’re out spending money. Now, with rates coming down, they’re going out and locking in lower-class debt, so mortgage finance boom is upon us. That’ll give people more disposable income to spend. I think we’re in really good shape on the consumer side.

And commercial, the business person is pulling back and a little more cautious, given some of the trade skirmishes. [They are wondering], “Should I really buy that extra piece of capital equipment, or should I hold off and see how the dust settles?” So that’s, I’d say, having a little dampening effect on loan demand.

But I think that’ll quickly be offset by rates coming down, right? We’ve had one rate cut, we might have another, if you look at the forward markets to this year. And I’ll tell you lower cost of financing stimulates more borrowing, either people want to lock in and refinance, just like the individuals dfo with their mortgage, the companies want to refinance their debt. Or price-sensitive investors who have capital to put to work, like sponsor firms or commercial real estate investors, they’re going to take advantage of those lower borrowing rates.

I think on both sides, we’re in good shape. You know, you could talk yourself, you could worry yourself into a recession, but I don’t think that’s going to happen. It’ll be interesting to see how the whole China scenario plays out. There could actually be quite a bit of upside if it works out well, but if we just operate in a protracted stalemate, I don’t think there’s huge downside.

How have you evolved as a CEO?

I’d say everybody who makes it to CEO goes through different phases in their career, when they start out as a player, then they become a player coach, and then largely, they are a coach. And I think when you get to that level, when you’re at the CEO, you realize how important having great people in the seats is. And then if you get the great people, you want to empower them. You don’t want to have an authoritative style. You want to let people align on the vision and the key objectives, and then give people the running room to go do their thing. I think my style, just you gradually figure that out. And I think you build a good team and then you really rely on it. So, I think that’s one thing.

I think the other thing you learned too, is that so I came up through the CFO track, so I’ve always been good with finance and strategy. But as a CEO, the soft skills are quite important. How do you motivate different people? What makes people tick? And so how you’re leading one executive on your team is going to be different than perhaps another executive. I mean, that’s an art that you learn over time. Communicating effectively is hugely important. So, if you’re a CFO, you’re really talking to investors, but then when you get to be CEO, you’re talking to all the stakeholders. You’re talking to customers, regulators, employees, politicians. And so really, the art of communication becomes critically important in being successful.

So, you just pick those things up along the way. And then you just have to have a good level of self-awareness to say, “Okay, what are my strengths?” I probably don’t need to spend that much time trying to perfect my strengths. But there’s things where I have gaps where I just didn’t have to call on those skills earlier in my career, that I really need to beef up and I need to work on those things.

And never be satisfied. Constantly look for what are ways that I can improve and challenge myself and grow, even when you become a CEO.

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