Vantage CEO Jeff Sinnott leads bank’s charge into new territory
Image: Jeff Sinnott, CEO of Vantage Bank, took the helm right after the pandemic broke out last year. His background in the technology side of the business helped him to keep the bank running while much of its workforce was at home, and to provide customers with access to their accounts so that their finances weren't disrupted.
Kin Man Hui, San Antonio Express-News / Staff photographer
In his time at Vantage, he has overhauled its computer systems and staffing structure in the wake of the merger — which, he said, did not require layoffs. Vantage and Inter National were “180-degrees different,” he said.
Inter National, which catered to international investors, was the larger of the two, with $1.4 billion in assets, but had seen its business shrink in recent years. Vantage, with $550.5 million in assets, had turned itself around after bleeding money in the years after the Great Recession.
"We brought the two banks together, and we really looked to turn the spigot back on. And we’ve doubled in size in the last 18 months," he said.
With the merger complete, Vantage had operating income of $102.5 million in 2020, and $55.7 million in the first half of this year. Under the previous CEO, Samuel Munafo, the bank launched an expansion into Fort Worth, and Sinnott said he’s looking to continue growing its territory.
Banking is part of his family history. During the Great Depression, his great-grandfather started the bank that became today’s Security Financial Bank, based in Eau Claire, Wisconsin. After graduating from Texas A&M University with a bachelor’s in business administration, Sinnott started his career as a software engineer at Bank of America. Before joining Vantage, he spent a decade as chief operations officer at Southwest Bank in Fort Worth.
He recently sat for an interview at Vantage’s headquarters on the North Side to discuss the merger, the pandemic, and the disruption wrought by fintech — or financial technology firms that offer digital banking services, such as Stripe and Chime — on community banks. The following has been edited for brevity and clarity.
Q: Inter National Bank had been shrinking when the merger happened — what was causing that?
A: INB had been acquired by (Grupo Financiero) Banorte (of Mexico). Banorte had plans to expand throughout the U.S., along the border in Texas and California, Arizona. They weren’t able to pursue that plan, for various reasons, but mostly regulatory reasons.
Eventually, they sold it back to the Collins family. And the Collins family brought it back, but just had no momentum. And there was some cleanup that had to occur as well. So during that time, it just was shrinking.
Q: Could you talk about the difficulty in merging INB and Vantage?
A: I’ve been through a lot of mergers, both in the banking world and on the software side, and it’s very difficult to get right. One of the things that helped us out of the gates was, unlike most mergers, we’re privately owned, so we’re able to do this without any intention of laying anybody off. Here, the edict to me was, “I want you to find the right places for these people. I want us to grow into our numbers.” And we did that.
One, we laid out a very clear strategy. Two, we put people in a lot of new roles. We’re starting this from the ground up, and everybody can bring their good ideas, but nobody can bring a backpack full of sacred cows. We started, really, from scratch.
Q: Why did the bank expand into Fort Worth?
A: There had been a lot of disruption in Fort Worth, with different community banks being acquired. We felt like a lot of that disruption created opportunity. Fort Worth now is our third-largest market. It has over $450 million in loans in two years, and is our fastest-growing market.
Q: What are your two largest markets?
A: The (Rio Grande Valley)/McAllen is our largest market, and San Antonio is our second-largest market.
Q: Any further expansion plans?
A: We do look to continue to expand in North Texas. We are looking at some expansion here in San Antonio. And then probably, in terms of new markets, the next area we’ll look at is likely Houston.
Q: How has your background in technology helped you as CEO?
A: As a bank CEO, with all the disruption that’s happening in the industry, coming from the technology side, where it’s always constant change, I think that has helped me a lot.
It’s helped me be ready to be a change agent here at the bank. It’s helped me provide confidence to a lot of people here at the organization that maybe hadn’t been exposed to some of the disruption that happens in industry. And it’s helped them embrace some of the opportunities with fintech that a lot of community banks maybe shy away from, or see as more of competition. And of course, there is competition there. But there’s also a lot of opportunity.
Q: When you refer to disruption, what do you mean?
A: You know, banking has been a sleepy industry for a very long time. A lot of that’s because of the regulatory environment, a lot of that is it was very predictable. And that’s something that I’ve always found as a great opportunity for banking, whether it was at a large bank or community bank. But now that disruption with fintechs is shaking that up.
You know, we talk about it here all the time, that the value proposition of the community bank has always been that we’ll have a deep connection with our customers, understand what they’re trying to accomplish and what would help them be successful.
The challenge, over the years — and why I think you see a lot of community banks shrinking — is now part of that response is technology. I think that’s good for community banks. I think it’s going to allow us to recapture that original value proposition, because it’s going to allow us to still bring those people to the table. But it’s also going to allow us, if community banks set themselves up correctly, to be much more responsive using data and technology.
Q: You took over as CEO around the time the pandemic hit. How did you adjust to that?
A: Fortunately, we have a really good team, so that helped tremendously. We actually had our first pandemic readiness meeting on Jan. 28. We ordered laptops, for everybody to have laptops, in February.
One of the things that we did, right out of the pandemic, before (the Paycheck Protection Program), is we went and did a deep dive with every one of our hospitality customers, and we modified pretty much all those loans. Because we didn’t know what to expect.
Q: How do you think the banking industry will be different in 20 years, in terms of the customer experience?
A: I think you’ll see banking a lot like you see content providers today, where they’re a trusted partner, and that’s who the customer wants to interface with. But there’s going be a lot of different partners that are part of that customer experience. We want to be very responsive to that and be able to bring in a partner that a customer sees as helping them be successful very, very quickly.
You know, you’re seeing a lot of these fintechs focus on very particular areas of the experience. And you see customers go to that for that experience. But when you talk to those customers — and the fintechs will tell you this as well — if they asked those customers, “If you could go back to your trusted bank, would you prefer to do that? If they offered the same type of experience?” The answer is overwhelmingly yes. So there needs to be that trusted partner that can connect these different solutions in a graceful way. And that’s what we’re set up to do.
Q: Inter National Bank was known for serving the international market. Is that still a big part of Vantage’s business?
A: Yes. About 30 percent of our business is international. We want to maintain somewhere between the 30 to 35 percent range. We see that as a clear reflection of the Texas economy itself. There’s a lot of transactions that are business owners that are operating on both sides of the border. We actually just made some hires with the disruption with BBVA and PNC, because we think that that’s a good opportunity for us and for Texas.
Q: How do you feel about the economy right now, with the delta variant spreading?
A: I think we’re fortunate to be in Texas. I suspect that if vaccines continue to be very effective against the delta variant, we’ll continue to have a growth economy for the next two to three years. I do think that inflation — it may not rise as quickly as it has over the last several months, but I do think portions of inflation are going to be with us during this time.
Q: Did I read that you have gotten into mortgage lending?
Q: Was that a recent thing?
A: We had a pretty small mortgage department coming out of INB, and we’ve been revamping that over the last year. We became an FHA mortgage lender — we were approved for that probably about a year ago. We’ve expanded our mortgage lending for foreign nationals. We’ve hired several mortgage lending officers. Right now, we’re doing about 25 to 30 mortgages a month. We do feel like that resonates well with the community bank, and we’ll continue to look for more mortgage originators and continue to expand that.
Q: How do you feel about the the housing market right now?
A: The housing market is on fire, really in every one of our markets in Texas. It’s kind of a balancing act right now — we’re starting to see a little bit of stare downs, in terms of consumers looking to be maybe a little more patient, seeing that it’s gotten just a little bit too hot. So hopefully, the acceleration will slow down just a bit.