The Industry Insider is regularly featuring interviews with members of RMA’s 2020-2021 Board of Directors that address how they first got involved with RMA, what they hope to accomplish this year, and how they’ve been coping with the effects of the pandemic. Today we present a Q&A featuring Seth Waller, executive vice president and chief credit officer at TIAA Bank, and RMA Credit Risk Council Chair for 2020-2021.
INDUSTRY INSIDER: How did you first get involved with RMA?
WALLER: About five years into my career, I took a credit role with a specialized division of what is now part of Bank of America (at the time it was NationsCredit). The credit leadership team there were long-time RMA supporters and encouraged the associates to read The RMA Journal and take advantage of training opportunities. I can remember attending local chapter lunches where an economist would speak, and an RMA-organized tour of the Federal Reserve offices in Atlanta. I also attended several RMA-led training courses (Anyone else still have the binder from “Structuring Commercial Loans I”?). As I progressed in my career, right up to when I first became a Chief Credit Officer, one of the greatest developmental tools I had was attending RMA’s functional round tables to connect with others who had my job at another institution.
INDUSTRY INSIDER: As Chair of the Credit Risk Council, what are you hoping to accomplish this year?
WALLER: We just had our inaugural meeting of the Council for the coming year. As is the case with many of the groups, each year we “turn over” about one-third of the group annually, and for the Credit group we try to find about a dozen professionals who represent the entire breadth of credit for all of the RMA membership. This means we try to have people who collectively have backgrounds in all the major product types, geographies, and from multiple lines of defense at every size institution, from community to large banks. We are still finalizing our goals for the coming year, but early areas of focus include COVID, CECL, and ESG. We also started a couple of subcommittees – one for consumer risk led by Duane Elmer, senior vice president, Enterprise Consumer & Small Business, at Bank of America, and one for accounting and tax led by Dan Cannain, vice president and market credit approver at US Bank – who will continue their work in those specific areas.
INDUSTRY INSIDER: Why is it important to you to take on the additional responsibility of Chair of the Credit Risk Council?
WALLER: It is something that I think is true of all the members of the Council, and that is that we think it is important to give back our time to help the industry. I have found this to be true of all the RMA members who volunteer their time, whether it be on the national board or local chapters. When I joined the Credit Risk Council the chair at the time was Meg Mueller, senior executive vice president and head of commercial banking at Fulton Financial, and she took time to organize and encourage the Council to help RMA be able to speak about credit issues on behalf of the membership. When Meg was ready to move on to the next phase of her career I was happy to take the Chair role, and I’m sure next year when it’s time for me to pass the torch someone will be ready to continue the Council’s work.
INDUSTRY INSIDER: What are some of the effects the pandemic has had on the industry and what have you come to appreciate from RMA during this time?
WALLER: Obviously, the pandemic has created challenges that differ in many respects to previous cycles. One area where I have appreciated RMA is in how quickly the organization pivoted to the virtual environment. Many of the RMA tools that I use (forums, round tables, etc.) moved to virtual meetings, in many cases shorter but more frequent. This has given participants a chance to engage in a timelier fashion to discuss issues.
INDUSTRY INSIDER: What are lessons learned that can be applied moving forward?
WALLER: I think the credit picture is still developing. On the positive side there has been some relatively good news in that to-date credit defaults have in many portfolios been lower through September 30 than would have been predicted earlier in the year, so credit view may be better than it could have been, and of course banks had much higher capital levels going into this crisis than they did going into the last one. However, in an absolute sense, credit stress is still “high” as is unemployment, and the “low” number of defaults to date is attributable to the extraordinary support items provided in the CARES Act or other measures. Those items are very important in building the bridge to the recovery, but that recovery will eventually need to be able to stand without such exceptional measures, and that path is still evolving.