What does “concierge banking” actually look like in practice? Mary Usategui, President and CEO of BankMiami, joins Banking On Community to talk about relationship-driven service, smart growth, and why community banks still have a real edge with business customers. Along the way, she shares her stories on building a bank, testifying before Congress, and how St. Patrick’s Day might have just set BankMiami up for success.
Transcript
Saxon Prater (SP): Welcome to Banking on Community, a podcast for community bankers. I’m Saxon Prater.
Tara Schultz (TS): And I’m Tara Schultz. I am personally excited to welcome the special guest to this month’s episode. I’ve had the pleasure to see her in several challenging roles and key leadership positions at both large banks and now a new bank, now with BankMiami as their fearless leader and their CEO, Mary Usategui.
Welcome to Banking on Community. Mary, can I have you introduce yourself to our audience for those that are not already familiar and share your background in banking?
Mary Usategui (MU): Absolutely, and thanks for having me, Tara and Saxon.
SP: Of course.
MU: So, as Tara mentioned, I’m Mary Usategui, I’m the founder, president and CEO of BankMiami. We’re a newly established de novo bank in Miami, Florida. We’re going up on a year next month on St. Patrick’s Day. We’re already over $200 million, commercial bank, that is really trying to pave the path and focus on concierge community banking.
A little bit about my background. As Tara mentioned, I have had the pleasure of working with Tara over a few different banks, from, I think we’re over 10 years now and my background stems from being a teller at a small local community bank over 20 years ago, and working my way up mainly on the financial side of things. I was controller that became CFO and helped establish a de novo bank, in my background from an $80 million de novo bank up to a $3 billion publicly traded bank.
We converted to CSI actually, when we were $250 million and CSI helped us actually cross that threshold of $3 billion and helped us become a publicly traded bank in my prior life. Our bank was purchased back in 2023, and I found a unique opportunity to start a new community bank. There hadn’t been a new bank in Miami in over 17 years, and I really felt passionate about what our team could bring back to Miami and decided that we were gonna take a shot on it. And we started the process in 2024, and we were able to open our doors earlier last year. And so here we are.
TS: I love it. She is an absolute awesome story in our industry and I love being able to spend time with her. I got the pleasure of doing that in Arizona recently at AOBA. So Mary when I first approached you about being on the podcast, a key part of that was around your efforts and your determination in the de novo efforts holistically. So anybody that is really narrowed in on the industry consolidation impact on communities, it probably the hardest time to navigate that journey when you started that journey.
So I wanna talk a little bit about what you went through and what I would really title is kind of a grueling de novo journey, with BankMiami being the first de novo bank in Miami over 16 years, I think that process took longer than you had expected. So you had done the work, you had raised the capital, you had investors knocking at the door, ready and, and excited about what you were doing. So why don’t you walk us through that journey, the timing and some of the hardest moments in that journey as a leader.
MU: It’s exactly what you said. You know, I, being a CFO prior, and, you know, I spent my whole life on business plans and planning and strategizing and creating budgets and I don’t like to miss deadlines. So in my mind I really had a great relationship with the regulators and felt very passionate about the bank that we were building and I knew that we had the team that really had the bench strength and the experience that the regulators would want. So I was pretty ambitious thinking that we could file the application and be open in less than nine months and that actually took closer to about 18 months from start to finish. So almost double the time of what we thought it would take.
Even that I’m hearing that’s pretty quick for a de novo bank, but in our mind, thought it would be quicker than that. So happy to report that there are a lot of changes sweeping in Washington right now to try to bring back more community banks, new de novo banks and so it hasn’t quite shifted just yet, but there’s a lot of noise trying to lift the burden. I’ll talk a little bit about what that burden is, to allow for more people the opportunity to start community banks. Back in the financial crisis, I don’t know if you’ve talked about this in the past, but just some, some interesting facts. There used to be over 130 banks started every year, after the financial crisis. We’re down to very minimal.
I think last year it was four banks that opened, BankMiami being one of only four. The year before that, I think it was like six, you know, so, and that’s across the country. Florida’s leading the charge with the amount of de novo banks that have opened after the financial crisis. I think we’ve had like maybe seven and two in the works right now with the filed application. So, um, obviously with the amount of M&A that’s occurring, we’re not replenishing new banks at the same pace that banks are being purchased. And many of these banks are being purchased from not just other banks. So really the banking space continues to narrow. Since the financial crisis, I think a lot of people, um, have shied away from thinking of banking as like a sexy investment, right? So it’s finding the right capital partners that really, truly believe that a de novo bank could be successful and so we’re very fortunate to be in a market that is booming.
Miami as a city has seen nearly double the population size since the financial crisis and believe it or not in 2008 there were 42 banks headquartered in Miami-Dade County. We’re down to 19 and two just announced their sale, so we’re gonna be down to 17 banks headquartered down here. So we’ve doubled in size in population, but we’ve shrunk the banks nearly in half and so it really just felt right from our standpoint that it was the time to do so.
But probably our biggest challenge is just outdated regulatory burdens, that even the people in Washington realize are outdated and they’re working to fix that. So, you know, an example would be by the time you file your application, you still can’t take, your first investment. You have to wait months before you’re allowed to take your first check and while you get the buzz going and everybody’s excited about a new organization and they wanna invest by the time you were actually able to do so, they either had invested in other things, or in our case, we filed our application in December, 2023 when we finally were given the green light that yes, now you can go ahead and start receiving capital.
Well, it was about summer 2024 and everyone was talking about the election, and if you recall the election, there was a lot of uncertainty on which direction the election would go.
At one point, Biden was still running and it was gonna be more democratic and then it went to Republican side with Trump, and then Kamala came in and then she was leading the charge. So, a lot of that uncertainty really put concern in investors eyes of, well, I wanna really wait and see how the election pans out before I decide to move forward with this investment. And we heard that a lot and so we still continued to raise money, but not at the pace that we wanted to.
But really when I think the page was turned was after the election was settled, and the administration that was chosen was one that was more favorable toward banking or deregulation. And, uh, that really I think was the, the tipping point for us to have a whole slew of investors then write checks, and we were able to get back on track and get our doors open. So the timing was a little bit unfortunate in our circumstance, but we were able to raise more than we had requested. And once that was behind us, that made it a lot easier and we were able to get our doors open.
SP: It sounds like, uh, St. Patrick’s Day was the right day to open though, because it’s like a signal of, you know—
MU: A day of good fortune.
SP: Exactly, exactly right. I love that.
MU: And I’m Irish by descent.
SP: Oh, perfect.
MU: Was absolutely all about the St. Patrick’s Day, opening day and those that are closest to me. My birthday is actually, in December, it’s between the week of Christmas and New Year, so always everyone’s always out of town on my birthday, so I start traveling and it became an ongoing joke that St. Patrick’s Day was like my birthday. I always drive all my friends out on St. Patrick’s Day to celebrate. So it wasn’t a surprise, and it just again, everything happened for a reason, but it was kind of fortunate and very much the merry way that we would open on St. Patrick’s Day.
SP: That’s really awesome. You were talking about Washington and some of the changes that are happening there, and, you know, uh, you testified before Congress, and I read through some your statements and you made a really compelling case for competition as well as some of what you’ve already started to talk about in terms of how difficult it is to start a new bank.
What’s your sense on if this is gonna be a long-term trend, do you think this is gonna be subject to whatever the next administration is, or what, what’s your feeling there in terms of the future of de novo banks and increasing competition in the space?
MU: I’ll tell you that the folks in Washington right now really don’t want it to be a pendulum swung type of approach to banking. They realize they have a unique opportunity right now to drive change, but some of the hesitation on why you haven’t seen change just swept in across the board right now is the fact that they’re trying to make sure that it’s permanent change, not just something that could swing at the next administration change. And then again, you’re going back and forth scrambling to now be over-regulated versus deregulated.
That approach is quite cumbersome for banks trying to plan and focus on costs when you don’t know what the right path forward it is. So I’m very hopeful because I do think there’s a level set of individuals in the house and in the Senate that are really trying to drive permanent change to allow for this to be more of stable environment regardless who is in the White House. And that is music to my ears, because I think after the financial crisis, a lot of folks panicked, rightfully so and a lot of change was brought in and, um, you know, the long-term effects of that I think were not positive towards the banking industry. So the lightning the burden and really being intentional on what needs to change and what doesn’t is being discussed on every facet in Washington and at the state level and at the regulatory level. But from the folks that I’ve talked to the forefront is they wanna make sure it is permanent, not temporary. That’s what’s actually driving much of the delay, is writing rules in a way that will protect the administration change from affecting, you know, decisions that are made today.
TS: Yeah, I sure hope so. Um, I love that you went to Congress and shared the story and shared the passion about what you really drive and bring to this industry and the importance of community banking is to the communities in which you serve. So hopefully it is a, a permanent shift of them being really facilitators versus gatekeepers.
MU: I agree wholeheartedly and all I can say is I wish this was would’ve done sooner because I think our path would’ve been easier, but one of the reasons I’m so passionate about it is that I’m hoping that if we can drive some change now, it can really be a positive boom for our industry and we can start to see more and more de novo bank activity.
SP: I love that. Yeah, I think that’s a great point. I mean, we talk a lot about the consolidation in the space. You already alluded to that as well with both credit unions and larger banks, as well as just the kind of competition throughout the industry, but I think BankMiami stands as a fantastic example of how you can be rooted in your area, you can be effective in your business and it really speaks to the need of getting new institutions with that clear focus in the landscape overall.
TS: Agree. Yeah, for sure. I think too, Mary, you talked about this a little bit earlier. You’ve been on both sides of the M&A equation. You helped grow professional bank from that de novo to a $3 billion publicly traded institution, before the Seacoast acquisition and a big reason for BankMiami was due to that M&A activity that you talked about and the critical needs that were really lacking for the businesses in your area.
So obviously we all know M&A is both a threat and a huge opportunity when you’re on the right side of that equation. How do you see the relationship between M&A and de novo formation? Do you see it as somewhat of a, you know, a balancing tension or two sides of balancing a really healthy ecosystem?
MU: I think it’s two sides of balancing a really healthy ecosystem. I believe that wholeheartedly, M&A is good, you know, finding capital investment or, a win for our capital investors is what we want as business owners. We want to find a win and we wanna find a way to do what’s best for our clients. I think that’s, yeah, you know, there’s many different reasons why an organization might sell, whether it be, you know, management succession and they don’t have the right fit, but another bank may, and by cap, by joining forces the clients can still continue to be served in a different scale, uh, technology.
You know, not all the smaller banks have access to technology that others may and that might be a reason to go ahead and merge is just to be able to offer new products set to the clients and other reasons. It’s more so just for other folks to enter new markets, right?
So it’s better for them rather than built from scratch. It’s better for them just to buy an existing organization in this particular market with known bankers and that’s kind of what happened with us with Seacoast is, um, you know, Seacoast had been in Florida for a hundred years as of this year. 1926 is when they started, but they had never entered into Miami-Dade County up until a merge an acquisition, you know, that happened two months before ours.
They did back-to-back acquisitions in our market and it’s because they realized that if they wanted to enter Miami successfully, it had to be with a team of bankers that already knew the market. So I think that’s healthy, but it also leads way for the option and the possibility of starting something new. So in our case, I have a great relationship with Seacoast and their CEO, but they’re going upstream, right? They’re 20 billion now in market in their market valuation. They’re 20 billion in assets, they’re focused on different areas.
We’re very much focused on small to medium sized businesses down here. And there’s enough of a competition down here that both of us can survive and do well in a peaceful and healthy manner. And so there really is just I think that’s the biggest key here is for the de novo banks to see is, and larger banks too, is that community banks are needed, you know, larger regional size banks, not every deal fits their size or it doesn’t make sense for them anymore to go after a $500,000, a million dollar deal. They’re up to 5, 10, 15, 20, 50, a hundred billion or a hundred-million-dollar deals, you know? But, but still, you know, I think, I don’t know the number, but what is it, 80 over 80% of small businesses like run the country. So, you know, that really the community bank focus on the small business area is something that is so needed.
You know, continue to see just market consolidation, but we don’t see any replenishment of the community banks thereafter. I do have a fear for what it means for small businesses and communities that are just now left as outliers and it’s just unfortunate. So I do believe that the folks in Washington see that and that’s why you’re starting to see such relief on trying to build back up the de novo front. But, absolutely it is part of the normal swing of the times.
If you have M&A, we do need replenishment and every other facet and industry, you see M&A and there’s replenishment. We just have not had that, it’s been a completely different tipping scale since the financial crisis, just constant M&A and rarely any new banks forming. Although after the, you know, some of the changes that have already started being announced that de novo bank lightening, there’s a lot more applications this year, which we’re happy to see.
TS: Yeah, more this year than in the last four years combined. So yeah, that’s saying something. You hit on something we talked a lot about at AOBA and it’s one of the most welcome strategic shifts for me. It’s seeing more community banks lean into their opportunity to attract, retain, and grow a healthy expansion of commercial services to really serve the businesses right there in their market and the unique needs of those businesses.
And for some reason, like you said, that used to be the domain of the larger FIs in the eyes of some, now banks also have the competition of fintechs in that, in that space and in that realm, not just in the realm of consumer services any longer, they’re dipping into business functionality. So how do you compete for that for commercial clients and your small business to mid-size business against both the big banks and the fintechs?
MU: I think probably our easiest competitive advantage is the service that we provide. We have our real human, it’s not a 1-800 number, it’s the real interaction that our bankers get to know our clients. We treat each client as though they are a private banking client. We don’t have minimums here versus some of the private client services of over a million or $2 million. You come in, our bankers know everything about your story and are always gonna do the right thing by our clients.
So that sometimes means turning away business, right? If a client comes in here and they say, well, this person down the street is offering me this, and it is right for them, we’re gonna say, you need to go there. And that trust that that we’ve been able to build is, you can’t just do it through an online platform. And so for us, that’s actually been at the forefront of our growth is really just those connections that we’ve been able to you know, reach out to our clients and really get to know them a little bit better and provide just excellent sources of input and financial knowledge.
That trust is really what’s setting us apart and so I think fintechs are great, right? They serve a purpose. And if you don’t wanna have a banker and you wanna just do everything online and that, that’s a certain niche, great. That’s awesome. We have great technology, we can do all that ourselves as well, but really we like try to have a good balance of just those that really want the extra mile of service and they know they have somebody if they need it, but at the same token, the technology we have is some of the best, and they can operate fully functionally without ever even having to step foot in the branch.
It’s really just providing a balance of that. But I do believe it’s that human personal touch that we haven’t had to differentiate ourself.
TS: Yeah and there’s truly that stickiness multiplier when treasury and business services are executed well, you have the technology, but then you’re doing that with differentiation and trust and that concierge touch.
So I love that. Thanks for sharing.
MU: I like to say “high touch, high tech.”
TS: I think we have a banner, right?
SP: I think we might, yeah.
MU: Do you have that? I didn’t mean to steal it.
TS: No worries. I love it.
SP: That’s okay. That’s okay.
MU: Trademark infringement, great.
SP: We’re all about sharing.
TS: That’s right.
SP: And I do like, speaking of the concept of concierge banking, that’s something that you guys have up on your website. I think that’s a great way to kind of encapsulate that, balance that you’re talking about, where it’s personalized service, you get to know your customers and you have the right technology to actually kind of see that relationship through.
So what’s next for BankMiami? What, what are you, what are you guys thinking about strategically? How do you see the future play out?
MU: Yeah, right now, so, you know, we’re kind of taking it year by year right now. So last year was getting our roots and the foundation settled, right?
We actually opened in a, like, it’s called Borough. It’s like a similar WeWork situation, so co-working space. So we, we had a branch in inside of a coworking space while we built out our permanent headquarters. So we finally moved into our permanent space at the end of November. We opened with people working half at home, et cetera So it wasn’t full, it didn’t feel like a full bank until we settled here in our permanent home.
So last year was all about getting the doors open. This year is really about expansion and community enhancement. So our focus for the next 12 months is really about community outreach and just getting our name and our brand recognized out there, and to let people know in the community, we’re here to service you, and we’re here to be a helping hand and really have an opportunity to demonstrate what BankMiami means. We also like to tell folks we want you to focus on the business, let us worry about the banking. I think that resonates a lot because unfortunately what’s happened with a lot of the larger banks is they’ve gone to a model where if you need something done, you have to call a particular department. You can no longer go to your banker if you need something else done. You have to call a different number and you’re not seeing that really handholding and so making sure our clients can see that we have the individualized service, but then also showcasing our great technology is key to us.
Profitability is also important to us. So we’ve grown exponentially in our deposits, which is a great thing. You know, people are seeing what the value is we bring and they’ve now flocked to our organization which means now we need to put the capital to work. So we’re trying to make very important strategic decisions on an on reinvestment back into our community, into the right loans and, uh, into the right areas and, and we’re doing just that.
So for this year, it’s really turning a profit.
And I think next year it’s gonna be then really just, you know, tying down the fort and really just trying to focus on expansion efforts in Miami-Dade and potentially elsewhere.
TS: That’s amazing. That’s awesome. Your journey has been so great to watch and to see the growth happen so soon speaks volumes of your people and the need in the Miami market too.
MU: It’s exactly the need. You know, our business plan was pretty aggressive in terms of growth according to the regulators, but we’re now surpassing that slightly. Not a lot. We’re surpassing it, but we as an organization and I’m sure many of your peer banks do the same, we look at our peers. So we actually have a list of the last five banks to open and it’s kind of astonishing, but it just tells you that if you pick the right market the rest will follow if you have the right team.
So we are, we’re very happy on our results thus far, but we still have a lot of work to do to, to focus internally and really just squeezing the most efficiency we can out of this organization.
TS: Great. Thank you for sharing. So Mary, what would you tell the next female leader, or like I call you powerhouse in banking about your journey or really about our industry and as, as they all tackle the next set of challenges throughout our industry?
MU: I’ll say this to all future banking de novo leaders, but I’ll probably, I’ll tailor it just a little bit of ways on an assumption made towards women in general. Women tend to be very hard on themselves if they’re not perfectionist. At least that’s what I’ve been told. I know that’s with me, and I know with a lot of other female leaders that I’ve been around that we aim for perfection and I still think it’s a good aiming tactic to be as close to perfect as possible.
But being okay with pivoting is needed when deciding to go forth this effort, so many things that I had designed, and again, I told you I did business plan after business plan did not go according to plan and looking back, it was a godsend, right? Like, I’m so grateful that it’s turned out the way that it has, but at the time, it was very frustrating that it wasn’t happening the exact way I wanted it. And so being okay with it not being exactly how I wanted, took some time and very much of an effort on my part to let things go and to navigate the new normal.
So I would just pass along that effort and that really does apply to all future leaders is it’s going to take longer than you expect it’s okay that it doesn’t go exactly how you wanted. Sometimes it happens the way it was supposed to happen. So again, double the time it took us to that we wanted to open a different team perhaps on certain areas that we wanted initially, but the team I’ve ended up with, and again, if I, if it didn’t take 18 months, I may not have opened on St. Patrick’s Day, right? You know, like little things like that.
You look back and you laugh at it, but it really I do believe everything happens for a reason and it’s just having the patience and the wherewithal to, stick with it. It’s not gonna be easy. If it was easy, there’d be new banks open every day. there’s a reason why it takes as long as it does, but it’s so fulfilling and worth it once you get to the finish line to be able to say that you’ve established an organization that is gonna change your community. I truly believe that is our purpose here, is not to just grow a balance sheet, but really try to transform our community by helping the small businesses and the consumers around town in ways that they may not have gotten by other larger organizations.
TS: We love seeing you fight the fight, obviously the industry, consolidation the needs within your space and even more so inspiring others to do the very same.
So very excited to be a partner on this journey.
MU: Yeah, I was gonna say CSI has been the best partner and a little plug for CSI, I mentioned it earlier, we’ve known each other for over 10 years, Tara, or close to 10 years. Switching to CSI back at our prior shop was the best decision we made and going through this process again, we could have chosen any core that was out there. We had everybody knocking on our doors, but we chose the core that we knew would align with our vision and when I say high touch and high tech, I mean that because I have the best technology available, but CSI allows me to also be high touch because if I have any issues, I know I go right to you all and it gets solved as quickly as possible.
Whereas some of the other cores that I’ve been at I give it a project list, it’s a number it’ll take forever, and I can’t quickly service our client like we need to I’m so grateful for the partnership that we’ve been able to achieve with CSI.
For anybody considering a de novo bank, I would highly recommend CSI, just been an excellent resource and partner for this and I know that we’re gonna be successful because of the technology we have with you all backing us.
TS: And you’ve done this before. This is not your first rodeo. So that’s amazing, so grateful to have you on and thank you for those comments too. I’m excited to be your partner in the fast growth journey ahead and Saxon I’ll pass it to you to wrap us up here.
SP: Yeah, thank you all for listening. Thanks again Mary for joining us and sharing your expertise. It’s really wonderful to hear from an on the ground banker who speaks at such a high level that it’s always good to actually hear your perspective, so we really appreciate it and your story is inspiring and we can’t wait to see what else is in store for you all.
What’s in store for us in the immediate future? Obviously Banking on Community will be back soon. CSI is also hosting our yearly conference, CX26, that happens in April, so go check it out on our website if you haven’t already.
Until then, keep banking on community.