Best Places to Work 2014: Exchange Bank

[nggallery id=13]

SANTA ROSA -- Gary Hartwick sees himself as a bank steward. He has been president and CEO of Exchange Bank since March 2014, and an executive with the bank since 2009, one of the roughest years in the bank’s 124-year history.

Exchange Bank recovered from credit challenges it faced during the financial downturn of 2008-2009, when it received $45 million in funds from the U.S. Department of the Treasury’s Troubled Asset Relief Program. The bank temporarily suspended dividends and its Doyle scholarships for students of Santa Rosa Junior College then resumed both in 2013. Treasury funds have been repaid, including the final $9 million early in 2014.

“When I came into this organization, it was in the depth of some dire issues on the credit side,” Mr. Hartwick said. “It was nothing but work, to get this ship turned around.”

“Gary was instrumental in the turnaround of the bank,” said Greg Jahn, chief financial officer, who has been at Exchange Bank for some 13 years. “It was a team effort. Gary played a major role” with his specialty in credit, where the bank needed help. Bill Schrader, chairman of the board, also was instrumental in the recovery.

Exchange Bank makes commercial and industrial loans to businesses, including a significant amount of lending to agriculture and wine industry borrowers. “We do both winery and vineyard production,” Mr. Hartwick said.

Real estate lending, including mortgages, accounts for about 67 percent of Exchange Bank’s total portfolio of $1.2 billion. Nearly 10 percent or $116 million is commercial and industrial loans to wineries, with 15 percent in other commercial lending, such as for vineyards and other businesses. About 8 percent is consumer loans.

Total assets are about $1.8 billion.

The Frank P. Doyle and Polly O’Meara Doyle Trust owns 50.39 percent of Exchange Bank, and funds the Doyle Scholarship at Santa Rosa Junior College. Due to this ownership structure, Exchange Bank cannot acquire other banks or be sold, Mr. Hartwick said, as that would dilute the trust’s ownership percentage and stray from the Doyles’ intent.

“Our ownership structure is substantially different from most banks,” he said. “We are not an institution that is looking for acquisitions, or will ever be looking to sell. We are a unique animal. That’s our differentiating factor from Bank of Marin, Summit State Bank, First Community Bank. None of those banks has the story we have. Our mission is to create a culture of giving back to the community.”

The Doyle trust “gives us a level of responsibility in serving the community,” said Mr. Jahn. “We’re this hybrid” between a charitable foundation and “we are focused on delivering an adequate return to our investors.”

“I look at my job as a steward of this company,” said Mr. Hartwick, the bank’s eighth president in 124 years.

In 2013, the bank gave more than $600,000 to about 300 organizations in Sonoma County. Mr. Hartwick looks at donations to nonprofits in Sonoma County as investments in community. Exchange has 18 branches in Sonoma County, with 405 employees.

“We encourage, actually mandate, that our senior officers are involved at the board level or senior management level of charitable organizations” in the county", Mr. Jahn said. “We give time away from the bank.”

Mr. Hartwick measures contributions in “time, talent and treasury,” including volunteer time, talent on boards, and donations by the bank plus personal donations of employees. “It’s part of our culture,” to participate in the Relay for Life, the Human Race and other charitable giving. “I was walking around a track at 3 o’clock in the morning,” at Sonoma Country Day School, he said. “If I ask our employees to do it, then I should do it.”

“People are excited to be here,” Mr. Jahn said.

Show Comment