For many business owners, the process of growing an enterprise is similar to raising a child. They guide it from infancy to maturity, while trying to influence their offspring with a sense of morals — or best practices — providing them with the tools and experience to succeed on their own.
It’s an apt analogy for Gerry Lipkin, the longtime chief executive officer and “face” of Valley National Bank, who recently announced he will be stepping back from day-to-responsibilities as of Dec. 31. Lipkin, who will be 77 in January, isn’t exactly retiring though. He’ll stay on as chairman of the board of the $23 billion Wayne-based institution that’s regularly ranked as one of New Jersey’s largest. Ira Robbins, who has been with Valley since 1996 and was named president earlier this year, will take over as the new CEO.
Countless numbers of consumers across New Jersey and other markets became aware of Valley from TV commercials that featured Lipkin hawking the bank’s offerings.
“Most banks are not as closely tied to an individual the way Valley is tied to Gerry Lipkin,” said Peter J. Ostrowski, a former analyst at the Federal Reserve Bank of Boston who is now a managing director at Ostrowski & Co. Inc., a Cranford-based bank consulting firm.
“Commerce Bank founder Vernon Hill was clearly the driving force behind that Cherry Hill-based institution’s ‘customer first’ strategy, which included seven-day-a-week and evening branch hours, but he wasn’t in much of the bank’s advertising, and I’m not sure how many customers even knew he was behind Commerce [which was bought out by TD Bank in 2008 and later rebranded as TD]. Industry insiders and observers knew that, but a lot of consumers didn’t.”
Lipkin is a former deputy regional administrator at the United States Comptroller of the Currency who joined Valley as a senior vice president in 1975 and became CEO in 1989. Some thought he would never leave voluntarily, “But never is a long time,” he said. “It felt appropriate to step down now.”
At the end of 1993, early into Lipkin’s tenure, the bank had only 59 branches, all in five New Jersey counties. Today, it has more than 200 throughout northern and central New Jersey, New York City, Long Island, and Florida. Valley also recently received regulatory approval to acquire USAmeriBancorp, a $4.5 billion bank headquartered in Tampa, Fla., with 15 branch locations in Alabama.
An outsized personality who can dominate a room with his presence without being intimidating, Lipkin’s also heavily involved in philanthropy, having been recognized by diverse organizations such as B’nai B’rith International, the Bergen-Passaic American Heart Association, American Red Cross, Sunrise House Foundation and Urban League of Bergen County. But he’s also quick to say that a bank’s success depends on team efforts.
“People associate Valley with a lot more than just me,” said Lipkin. “More than 3,000 people work here — and we’re growing — so there are a lot of people who make Valley a success. Think about our operations in Florida; the people there know the local bank manager, they don’t know me.”
People in the industry credit Lipkin with being a driving force behind the bank’s expansion. When asked whether the growth will continue under Robbins, Lipkin said, “Ira is ready, and I know it because I’ve worked with him for more than 20 years. Ira’s working on a lot of strategic moves.”
But when Robbins talks about succession, he talks about philosophy.
“Gerry taught us about the foundation of a great bank,” he said, sounding like a student referring to a respected mentor. “At the base of it, he showed us that if you have a moral compass you’re OK. The important thing is that everyone here has similar values. You have to add value to the community, and provide a positive customer experience.”
Robbins may share some of his predecessor’s core values, but that doesn’t mean he’s not going to be his own man. For one thing, he’s looking for organic growth, at least initially, in contrast to the steamroller acquisition strategy that saw Valley acquire more than a dozen banks during Lipkin’s tenure.
Lipkin shepherded the bank through shocks like the financial crisis of 2008, when Valley received $300 million in government aid and later paid it back. Then he helped Valley negotiate the regulatory maze that followed, as the federal government tried to corral risky lending with stiff capital cushion and other requirements.
The landscape facing Robbins is much different.
“Today, the main challenge isn’t regulatory,” said Robbins. “It’s technology. How do you serve the customer the way they want to be serviced? You have to deliver a unique experience over a cellphone, in person, or any other way.”
In a bid to balance the personal touch even as more customers move to mobile banking, Robbins said the bank is “making changes to our branch models. We’re closing some down but at others we’re also taking down the physical barriers that separate customers and bankers. We want to deliver a uniformly positive experience across all channels. We have to remain relevant. Just accepting the status quo is death.”
As Robbins noted, businesses have to evolve or perish. And as he puts his own mark on Valley, Lipkin will be around to offer advice, if he’s asked for it, but he doesn’t plan on butting in. “I’ll still be active as chairman of the board,” Lipkin said. “But it’s up to Ira to call me.”