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The Power of Truth
Every decade or so, there’s usually a banking crisis. The cadence of such events creates a whole class of seasoned leaders in the banking industry who have seen the worst and survived — and they have stories to tell.
One of those is H. Lynn Harton, the chairman and CEO of $28 billion United Community Banks in Greenville, South Carolina. He led a different bank through the 2007-2008 financial crisis, first as chief risk and credit officer, and then as CEO. He decided to lean into the power of truth. As the bank struggled, an employee asked him whether it was for sale. Saying “yes” meant the bank could lose critical employees during a crisis. Saying “no” wouldn’t be truthful. “They’re smart people,” he said on stage at Bank Director’s Acquire or Be Acquired Conference in early February. “I took the position that we’re not going to get through this unless we tell them everything.”
Harton’s answer was “yes,” and in fact, the bank did sell, for 28 cents per share.
Stephen Steinour, the chairman and CEO of $225 billion Huntington Bancshares in Columbus, Ohio, took the helm of the struggling Huntington at the peak of the same financial crisis in 2009, when the future of the bank was in doubt. Steinour said leaders need to be willing to face the truth. He also takes an attitude of openness. During the crisis, he trusted the bank’s lead director enough to send him on a road tour to talk to employees. He also encourages members of his management team to talk directly to directors or regulators. “They don’t have to go through me,” he said at the conference.
To find the truth, it’s helpful for leaders to get out of the office sometimes. Randall Chesler, the CEO of $32 billion Glacier Bancorp in Kalispell, Montana, said he leaves the headquarters to talk to tellers and customers opening accounts, and to visit different regions. He’ll hear about problems, such as whether a system hasn’t been operational for weeks. “I learn a lot more out of the office than in the office,” he said.
He knows how important it is to for the CEO to stay informed. “One person sitting at the top can make or break a company,” he said.
• Naomi Snyder, editor-in-chief for Bank Director
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