Talking PPP, the Power of Local and the Potential to Do Good with BNB Bank’s Kevin O’Connor

“You don’t know what you can do.”

Seven words and BNB Bank President and CEO Kevin O’Connor has encapsulated the plight facing businesses and individuals not just here on the East End, not just across Long Island, but everywhere. It is both literal and theoretical. You don’t know what you can do based on the ever-changing health crisis, evolving government rules and plans, personal and professional needs that morph daily, if not more frequently. You don’t know what you can spend or when you should spend it, what you can do to get your family and your business through today and have it prepared for the next day, and the next. You don’t know what you don’t know.

O’Connor, better than most, understands the plight of the small communities and businesses that are the heart and soul of the East End and Long Island. He has seen and heard the powerful sense of uncertainty. “We’ve been asked, how do we come back to normal?”

There is, of course, no single answer. There will be no quick flip of some magic switch that turns everything back on. One cannot overstate the effect coronavirus has had on the local economy, and no one moment will crystalize how deep the impact runs. The tendrils reach far. You see construction sites standing still, but think about the suppliers, all the different trades, the legal and insurance sides, that were involved in that single project. Or take that wedding that was just cancelled, and consider the venue and the caterer but also the florist and the tuxedo rental and the hairdressers and the valets and the photographers and…

The Paycheck Protection Program (PPP) has been a lifeline during these times for businesses across the nation, the initial $342 billion having been given out in less than two weeks, spurring Congress to approve an additional $310 billion, for which the application process began again this past week. Getting this special Small Business Administration (SBA) loan from the federal government—which businesses will not need to repay, up to $10 million, if employers keep their staff employed throughout the COVID-19 crisis and follow other guidelines in using the money—requires the help of a bank, which applies on behalf of businesses and wades through a process that has presented its own set of challenges and frustrations.

BNB Bank, which secured 2,500 loans totaling roughly $700 million for applicants in that first round—80% were for $350,000 and less, and helped save between 40,000 and 50,000 jobs across Long Island communities—has a unique perspective and playbook as a community bank. As much as it has been in headlines, the actual existence of the PPP program goes back only mere weeks. Rules and parameters were still being worked out by the federal government while hundreds of BNB employees were already being broken into teams and working on reviewing processes and getting things moving for customers.

As the sense of urgency rises each day for businesses to open and get back to work, we become more aware of those deemed Essential Workers who fight the coronavirus war on different fronts.

“The nature of our business, we were always ‘essential,’ so we’ve been working,” O’Connor says. “We have 40 branches up and running. I’m trying to go a million miles an hour, to respond to messages from customers. I’m also figuring out how to work this way, how to create a culture, if you will. I have some people who love working from home, and I think some of them are very effective.

“With the PPP, I am amazed at how effective we were, given the remoteness of it,” he continues. “Maybe it was people’s ability to work from home, where you can work at four in the morning, that was part of the success. So there’s the bright side of that cloud. As bad as what’s happening is, it’s a great opportunity for community banking to have a positive impact. We’ve been getting messages from our customers, but there’s also been a positive effect on bank employees.”

He pauses to share an email:

Hi Kevin,

I know we have been hearing great stories from our customers both new and existing, but something else I have noticed is the positive effect on Bank employees. I have spoken to many employees over the past few weeks and that despite the long hours, many are feeling a tremendous amount of personal satisfaction.  During a crisis everyone is looking to do “something”. The PPP has allowed all of us to contribute to our community in a very tangible and rewarding manner. Crazy as it may sound, I believe that job satisfaction may just be at an all-time high.

At this risk of sounding like I am buttering up the boss, I am very proud to work at BNB and a lot of my friends at other banks are jealous of our performance.

“I choke up every time I read it. And that sums it up.”

COMMUNICATION AND CHANGE

Its roots dug firmly in East End soil, even as it has expanded since opening its first doors in Bridgehampton in 1910, BNB has found its past playing a unique role in this new present.

“When this first happened, even before the PPP program, those first few weeks we were open, banks offered a sense of normalcy,” O’Connor says. “The lights were going out everyplace, but our lights stayed on. Thankfully, our branch people were at the forefront. We kept them open as long as we could before we went to locked doors and appointments, but people would come in, and it gave them a place to go. All our lenders and branch people, they have relationships with their customers, and they were just talking. The important thing is being here to listen.”

Along with stories and discussions around financial issues—“You’re watching people’s life’s work potentially going away, so some of the stories are scary”—O’Connor understands the other challenges facing businesses. On some levels, they mirror his own—creating that culture for employees to work remotely, discovering means to motivate and maximize efficiency, finding new and effective ways to communicate. That last point should actually move to the top of the list.

“The message has been lots of communication,” he stresses when reflecting on how BNB has been adapting. “I’ve taken the advice that lots of our employees have given about what we’re doing here. We have a standing, weekly virtual town hall where I speak to all of our employees, using our internal bridge, where I post and share different things. When I get an incoming message from a customer thanking us, I share that with lots of people, and in my response I make sure the customers understand that it’s not just the people they see, but the people in the back office, that this is one group.

“The customers who are being successful are the ones who are treating their employees that same way,” he continues. “We’re not so far removed that we can’t remember from 2008 to 2010, when it was difficult, and I think the businesses that survived and have been around all that time have recognized that they’ve had great dialogue with their employees.”

Not to mention conversations with others. Reach out to your clients. Your vendors. You may need to have a discussion with your landlord. Beyond payroll, there may be questions about your residential loan, where are you on your commercial mortgage, other lines of credit. Questions can lead to answers, and then to other essential questions, in an ongoing cycle.

“The best advice I can give businesses, and we’re seeing it now, is who is the banker that you call? Who is your adviser?” O’Conner offers. “It’s about your banker, not your bank. With BNB, you have a banker. I used to kid around that BNB is not a person, the bank is not a person, the bank does not make decisions. People make decisions. You have an accountant, you have a lawyer, you should have a banker who you recognize and trust, who you can pick up a phone and call.

“It’s communication back and forth. Don’t go radio silent with us as an institution, as your banker. We’ve done a lot of outbound calls. My people have never been busier, not just with the PPP program. There are businesses that are looking at this as an opportunity, and we want to be there for them, too. In all aspects we are trying to work with our customers, trying to figure out how we get you from Point A to Point B. That’s the goal.”

CHALLENGE AND CHANGE

Retail businesses on Long Island have had to change their approach and models as the internet has consumed more and more of their business. The movement into more of a service-based economy has not been an easy one, its difficulties and frailties now becoming more magnified.

“Businesses here are dependent on people coming to visit you, or you going out to people’s houses to do work. Service is a big part of what we on Long Island do,” O’Connor says, adding that not only the past but the future has become based on that model. “The downtowns—especially the revitalization of downtowns across the middle of the island—have been built around restaurants and food service, and those businesses are always on the knife’s edge, so that’s been a challenge.”

A wise man once said there is no failure, only a challenge needing to be overcome. Part of that challenge is seeing where it exists in the first place. That may be the new approaches of restaurants or revitalizing the overall hospitality industry, O’Connor sees, or jumpstarting the stall in construction or assessing the next wave of home schooling and its impact not only on the students and the resources available to them, but on parents, especially essential workers who cannot be home.

“This gets back to the socio-economic issues on Long Island,” he adds. “There are people who don’t have broadband internet, they don’t have laptops, they’re trying to learn on their phones. And if your parent is out working instead of being home and going through the quarantine-at-home, that has to be a challenge.

“How this plays out for everyone is a challenge, even how we at BNB decide to go back to work We’ve created a group here that is thinking about the ways we can do that. We’ve already ordered 50 thermometers, but we are in a multi-tenant building here, so I don’t know whose responsibility it is to test everybody who comes in. Does the landlord have to do it all of a sudden? After 9/11, we created that whole industry of people who sit in buildings and check you in. Is there going to be a second desk to take your temperature? I don’t know.”

CARING AND CHANGE

Your neighbor needs help. The shop around the corner needs help. Food pantries need help. The elderly need help. Youth services organizations need help. The number of 501(c)(3) nonprofits in the five townships of the East End reaches into four figures, and they all need help. Getting behind such need and figuring out ways to help seems part of our community DNA, on personal and professional levels.

“Everybody is sort of stepping back and thinking about this whole thing, and people are pulling together. They really are,” O’Connor says, and you can hear a brightness in his voice. “I know there are really bad stories about people taking advantage, being myopic or selfish, but I think, generally speaking, people are good. The East End is a small community of small towns, but even further up the island there is still this desire to work with people. I think everybody feels they’re in this together.”

BNB has a long history of supporting myriad organizations and needs throughout the year. Yet in the curious way that time now speeds up and slows down and demands more of people while not giving any more of itself, they have seen the need to fold the calendar up and accelerate some initiatives. Even in cases where fundraising events such as spring golf outings and the like have been cancelled or moved to a virtual setting, the charity support and monetary donations continue.

“As part of what comes out of this PPP program, we’re going to generate some fees and be making some donations out of that, too,” O’Connor notes. “There are a lot of grass roots things, whether it’s food pantries or veterans organizations, that are having to deal with this, so we’ve accelerated the donations we would normally make throughout the year to now, because this is when people need it. And we will probably exceed our donation budget, if you will, for this year.”

That giving has continued to be inspired by what we have seen all around us. Businesses and individuals are constantly finding ways to give back, both large and small.

“There are some great stories. Restaurants that are by themselves, struggling—across Long Island—that are feeding hospital workers. The young people who are involved in organizations that are shopping for seniors who can’t get out—there are things that people who are young and healthy, with the right safety precautions, can do for people who are more vulnerable. At some point in time, the way we’re going to get back to work is that the people who can will do for the people who can’t. The more vulnerable of our population will have to stay indoors and away from people longer than those people who are less vulnerable. You don’t want to sound invincible, but if you feel you can do things that can help somebody who can’t do them, that’s very important.

“As an organization, every one of our employees, they’re watching heroes and they want to be part of the solution, not part of the problem, and that’s what helped them rally to do what they did under the PPP program. I have fielded lots of compliments from customers that I’ve passed along, because people are working very hard, a lot of hours, and I want to make sure they all know it. We’ve also fielded them from our competitors, who have been impressed by what we’ve done. It’s a testament to what this organization has always stood for—it’s for its community. You give them an opportunity to shine, and they do.”

You don’t know what you can do…until you do it.