One on One with John Witherspoon, president of Skowhegan Savings
Photo / Tim Greenway
John Witherspoon of Skowhegan Savings says customers want a branch office nearby, but they also want the most advanced technology, doing more than half of transactions online.
John Witherspoon never envisioned a career in banking. But in 1979, fresh out of college and a three-month hiking adventure on the Pacific Crest Trail, Witherspoon joined Kingfield Savings Bank as a management trainee. With $5 million in assets and a staff of six, it was the country's smallest mutual savings bank. The job, he imagined, would provide an opportunity to build his resume and put him close enough to the slopes to ski lots in his spare time.
Five years later, at the age of 27, Witherspoon became the bank's president and CEO. The bank eventually grew to eight branches and $120 million in assets, and was sold to Camden National Bank in 2000. Today, Witherspoon is president and CEO of Skowhegan Savings Bank, which has $600 million in assets and 150 employees at 15 branches in Somerset, Kennebec, Penobscot and Franklin counties. Witherspoon recently spoke with Mainebiz about some trends in banking and the economy.
Mainebiz: Are you feeling the effect of Maine's labor shortage?
John Witherspoon: From Jackman to Farmington to Skowhegan, one of the consistent messages from businesses is the lack of qualified employees. It's not for lack of people. I think there's a mismatch of skills with opportunities. It has not impacted our customers' ability to manage existing obligations, but I do think it has restricted their growth opportunities to some extent. It forces businesses to invest in technology and mechanization to increase capacity without increasing employment.
MB: Does your bank struggle to hire and retain workers?
JW: We're not having a hard time bringing people in. Quite a few come from Husson University and Thomas College. A lot of their students come from our market and want to stay. The challenge for all banks is that there are a lot of baby boomers in leadership positions and we need to find the next generation. So we look for people who want to be leaders and spend time developing them once they're in the door, giving them leadership and team-building skills. And we hope that they stay.
MB: Are your customers demanding online and mobile services?
JW: People want their branch, and they want online services too. It's not just millennials. Everyone is looking up balances, paying bills and transferring money online. More than 50% of our transactions occur either on a mobile device or online. That requires a huge investment for us. We recently added mobile deposits. And we'll be looking into offering mobile payment systems such as Apple Pay, and some type of peer-to-peer payment system. But our business model relies on personal relationships. Although most banks rave about their service, we back it up by answering all calls to the bank with a live person. And 95% of the time, that person can solve the needs of the caller. Hopefully the world will still value that going forward. If it doesn't, the relevancy of any community bank going forward is going to be put into question.
MB: Is cyber security an issue?
JW: It is an ongoing concern, as is the cost of maintaining firewalls and testing to assure that confidential information is secure. In the first nine months of the year, we've incurred more than $100,000 in costs related to reimbursing customers whose debit cards have been compromised by criminals hacking into the payment systems of major retailers. When retailers get their card processing systems hacked, the customers that are impacted are held harmless for any losses and the banks pick it up. In addition, we have to reissue cards — sometimes in massive quantities — at our cost. At one time these costs were absorbed in part by the exchange fee banks would get for each transaction. But regulation and pressure from retailers, who don't want to give up revenue or take responsibility for the losses, has restricted this income, so we absorb it as a general cost of providing these services to our customers.
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