Shelly Holt, President of First Community Bank Utah

Guest: Shelly Holt, President, First Community Bank Utah (a division of Glacier Bank)

Host: Chris Hatch

Listen on Spotify

Summary

Chris Hatch, who sits on the bank's board, talks with Shelly Holt, president of First Community Bank Utah and its first female president. Shelly shares how a one-to-six teller job at Zions Bank during college turned into a lifelong banking career, and how a Melinda Gates book inspired the "era of lift" she has led for five years, built on mentoring, a leadership academy and growing the next generation of bankers. She explains why the 1905-founded First National Bank of Layton chose to merge with Glacier Bancorp to keep its people, how that raised its lending limit from $7 million to $50 million, and its push past $1 billion in assets. They also cover COVID and PPP lending, the 2022 rate shock on bank margins, the outlook for rates and Utah business, advice for young borrowers, home ownership as the American dream, and leading as a woman in banking.

Key Takeaways

• Banking fees reflect real costs, and good bankers add value you may not see, like catching check fraud the morning it happens.

• When you lead, you don't need all the good ideas. You need to recognize them. Many of the bank's programs came from its employees.

• Mentoring and leadership training help close the knowledge gap as long-tenured employees retire.

• First National Bank of Layton chose Glacier Bancorp because it buys good banks with good people in good economies and leaves them alone, which preserved local jobs and decisions.

• Joining Glacier raised the lending limit from $7 million to about $50 million, letting the bank keep larger commercial customers.

• Rising deposit rates in 2022 squeezed bank margins as much as rising loan rates hurt developers.

• Focus on relationships, not transactions. The bank weighs the whole relationship before matching a rate.

• Young borrowers should talk to their banker early about one-, two- and five-year goals and let the bank help them prepare.

• Commercial real estate is a relationship business. A community bank has a toolbox to structure creative loans.

• Never forget the person. The person comes first, and everything else follows.

Transcript

[01:45] Chris Hatch: Welcome back to the Dirt Dog Pod. Today we've got an unbelievable guest, Shelly Holt, president of First Community Bank Utah.

[01:51] Shelly Holt: Thank you so much.

[01:52] Chris Hatch: Thanks for joining us.

[01:53] Shelly Holt: My first podcast.

[01:54] Chris Hatch: Well, the least we could do is have you on a podcast with a prestigious name like the Dirt Dog Pod.

[01:59] Shelly Holt: Yes. I feel like I've started it well.

[02:02] Chris Hatch: So you were just telling me how you were psychoanalyzing me while you were sitting in my office. Do you care to share any more there?

[02:10] Shelly Holt: About your office, or mine?

[02:11] Chris Hatch: Well, just what you found out about me.

[02:14] Shelly Holt: Well, there was a 45-47 hat. I saw that. So I said, "Hmm, okay." Lots of sports. There's a crocodile or an alligator in the corner, which I said looks really real.

[02:24] Chris Hatch: It is very real. It's an alligator.

[02:26] Shelly Holt: So I scooted away from that. There's a mini treadmill, and I said, "Well, there you go."

[02:32] Chris Hatch: You probably noticed it wasn't as used as it could be.

[02:35] Shelly Holt: Well, I was wondering. It wasn't right by the desk; it was over a little bit. But there were lots of good pictures of people. It just reminds me how active you are. You're really going a lot. Remember that one time I sent you a text and you responded so quickly, and you said, "That's how I roll"? And I was like, "Okay. Now I know."

[02:59] Chris Hatch: It's mostly just that if I don't do it right now, I'll forget about it.

[03:03] Shelly Holt: We needed you to sign something, and it was back in like 10 seconds.

[03:09] Chris Hatch: That is how I like to live my life, for sure. Well, we've had a wonderful time getting to know each other over almost the last year, right, since you asked me to be on the board for the bank. It's been a tremendous experience for me.

[03:23] Shelly Holt: Has it been interesting for you?

[03:26] Chris Hatch: I think I have a decent handle on retail and on commercial real estate as it relates to retail. I really didn't have that great an understanding of some of the other asset classes, and I think that's what's been so fun for me. And all the governance you have as a financial institution... it really is difficult sometimes to work through how much governance there is. I think it's easy for a lot of people to complain about banking and their relationship with their bank. Maybe they're frustrated that they have fees on their account, or that it costs money to wire funds in and out. I don't think most people spend much time thinking about how a bank makes money.

[04:05] Shelly Holt: And those services actually cost us. They're an expense to us. For us to do a wire, there's a charge we pay. And not only that, but think about the competent person helping the customer in that role. There's another component, too: if you have a banking relationship and you're inclined to complain about it, what you may not be thinking about is, "Is the person actually helping me a professional? Are they a nine out of 10, or a 10 out of 10, in the industry? Maybe I'm taking all of that for granted, and maybe I should just get over the fact that there's a charge."

This morning, we had a customer, a nonprofit that banks with us, and one of our employees noticed they had a check go through in an unusual amount, too large for them. She called them and said, "This is unusual. What's going on?" They discovered they had fraud. They didn't know until our employee called and asked, "Why do you have such a large check going through? You normally don't." And they said, "This isn't us." Since then, and that was just this morning, we've discovered several of their checks out in the community.

[05:09] Chris Hatch: Oh my goodness.

[05:10] Shelly Holt: So it's that one person who notices something who makes a difference.

[05:14] Chris Hatch: Well, it's been a fun year for me. Like I said, I've learned a lot. I've thought a lot about how a bank makes a profit. And I've thought a lot about the team members. I've always been very impressed with the team members you've put together. You really have a killer team.

[05:28] Shelly Holt: And with that, Chris, if I could just say: to me, the part about making money and meeting goals is a means to an end. The end is over here, and to me, that's community. Investing in our communities. What can we do to help our communities and our employees? Those are my two priorities: our communities and our employees. Once I get the loan portfolio going and it's making money and everything's churning on its own, then I get to do the fun stuff, which is our communities and our employees. We're really close to that point, and I'm excited about that.

[06:02] Chris Hatch: That's wonderful. How long have you been in the role here as president?

[06:06] Shelly Holt: This is my fifth year. I've been at the bank for 20 years, which I know has you saying, "Wow, really? You look so youthful." But yes, I've been there for 20 years, and I've been in banking my whole life.

[06:17] Chris Hatch: Why banking?

[06:18] Shelly Holt: Well, I'll tell you. My dad and my two uncles were all in banking, so some people think it's because of that. I'll be honest: it's because banks have great hours, paid holidays, and they're usually closed on Saturday.

[06:31] Chris Hatch: I thought you were going to tell me you like Dum Dum suckers.

[06:35] Shelly Holt: I love the suckers. But I was a student at the U, and I found a teller job, one to six. Still one of the best jobs I've ever had. I'd go to school in the morning and be a teller from one to six. All my friends were in retail or fast food, working until nine, 10, 11 o'clock at night, and I could go do my homework at night. One of my best jobs was that first teller job.

[07:01] Chris Hatch: So you weren't with First Community at the time?

[07:03] Shelly Holt: I started at Zions Bank. My dad was at Zions Bank in the investment department, and he really wanted me and my sister... we both became tellers at the same time, at two different branches, and we did that while we were in school. We worked in the afternoon and went to school in the morning. And then I became manager of our branch when I was 22.

[07:26] Chris Hatch: That's pretty young for a branch manager.

[07:28] Shelly Holt: Yeah. And that was hard, because then I worked full-time, more than full-time, so I had to go to school at night. Back in those days, you couldn't do anything online or virtual, so you physically had to go. I'd go to school at night after I got done with work. Sometimes in summer, at 10 o'clock at night, I'd be looking outside at people having fun while I was still in my 10 o'clock class. But I thought, "I need to graduate." So the last couple of years, when I was a manager, were hard, but I plugged through and graduated in finance from the University of Utah.

[08:00] Chris Hatch: Outside of a few blips over a very long time period in the country, banking really is a very stable situation.

[08:06] Shelly Holt: It really is. You can go back and debate whether banks have too much power, or whether there's enough central government oversight, all of that. But they really play an integral role. That's part of why we have so much regulation: for the most part, we do a lot for the government. Sometimes we feel like we're the police for them. "Get us this information, and get us this information." And we're like, "We still have a business to run." And that changes with each administration, as you can imagine.

[08:35] Chris Hatch: So what does the bank look like today versus when you took over as president five years ago?

[08:40] Shelly Holt: What I really tried hard to focus on... I think every person, or at least I do, has to have a purpose. And I was really trying hard to find my purpose. It was announced in September that I was going to become president, but I wasn't supposed to take over until January. I was at the beach in Laguna Beach, California, where I go every year, and I was thinking, "I need a purpose. What's my purpose?" I read a book by Melinda Gates called The Moment of Lift, and it just came to me: we are going to make this the era of lift. And that's what we've called the last five years while I've been president: the era of lift. What do we lift? We lift our employees, we lift our communities, we lift our training, our learning, everything, our values. It became the era of lift, and that's what I've focused on for the last five years.

[09:25] Chris Hatch: Wow. Fun. When you think about lifting your team members, let's go there for a minute. What are some of the things you've done to build them up?

[09:35] Shelly Holt: What's fun for me, and I believe this fully, is that when you're the leader, you don't have to have the good ideas. You just have to know what they are when you hear them. The best ideas we have come from everybody else, and I just have to say, "That's a good idea. Let's do that." So some of the things we've been able to do, which have not come from me: we have a formal mentoring program that we started three years ago, which has been really successful and really fun, mentoring some of the younger people coming up through the ranks. We have a leadership academy, which was not my idea. Two of our employees went to graduate banking school, came back and said, "We'd like to do a leadership academy." We've done that for the last four years.

[10:16] Chris Hatch: Is that an extracurricular learning situation?

[10:18] Shelly Holt: Every year we have our employees apply. This is our third year that we're in it right now. We have monthly classes, and they write papers and do homework and such. We have the leadership academy and a leadership boot camp for other employees, and just next week we're starting a leadership seminar. That's because a lot of people are going to start retiring, and we've already seen it. You have this group in their 60s who are all starting to retire, and we need to get the next group ready to go. Right now they're on the bench, not in the game yet, and I'm just trying to get them there. There's a big learning gap between the people who've been in those positions for 25 or 30 years, because we have a lot of longevity at our bank, and those who are five years in. What can we do to bridge that gap?

My goal is that I would love every employee to retire from our bank. Some will, some won't. But while they're there, I want them to be the very best version of themselves, whatever that looks like. I don't know what it looks like, and that's the fun part. What's the best version of them? How can they learn and grow, and how can I help them? If they look back 20 years from now and say, "You know, that job I had at First Community Bank was one of the best jobs I've ever had," even if they're not with us, that's what I want. That's the legacy for me, Chris: helping them become the best version of themselves.

[11:37] Chris Hatch: We did a ton of loans with Kirk, who retired from the bank a couple of years ago. Boy, think about the knowledge in his head as he walked out the door that last time.

[11:47] Shelly Holt: Yeah. And because we have such long-term employees, we had to ask, "Okay, what do we have to do?" There's different learning, there are different schools, but there's a lot on the job. There's a lot of learning from the customers, of course. We're very fortunate that our average tenure is 20-plus years. We have two people who've been there 45 years. It's the only place they've ever worked, straight from high school.

[12:14] Chris Hatch: I don't think their cars can drive anywhere else.

[12:16] Shelly Holt: When they retire, they're still going to come hang out with us in the parking lot. So yeah, we have great employees.

[12:24] Chris Hatch: That's good. So in the era of lift, you've certainly lifted the profile of the bank, from my perspective. When I first understood the bank, through one of the other board members, who's a good friend of both of ours, it seemed like you were kind of an up-north bank that didn't really have much coverage. That is very much not the case now. Even when I joined the board a year ago, I kind of thought it was just a northern Utah situation without much impact anywhere else. And that is very much not the case.

[12:58] Shelly Holt: We're spread throughout the whole state. Our origin is First National Bank of Layton, which was founded in 1905. It's the first bank in Layton. 1905, a long time. But up until five years ago, we were $300 million, which is still a really small community bank.

[13:13] Chris Hatch: And that's in terms of total deposits?

[13:15] Shelly Holt: That's in terms of total assets. And I'll tell you a little of the background on why we're now First Community Bank. Honestly, if we hadn't changed the name, I don't think a lot of people would have noticed, because we still had the same faces. So many people were worried we wouldn't have the same faces, but that's the reason we did the merger: so we would.

About seven years ago, people wanted to buy us left and right, all these in-state banks. And why? Just what you said: they wanted Davis County, and that's where our headquarters is. They really wanted us. But we realized that if they bought us, they'd only want the branches, the teller line and the loan officers, and all the back-room functions would go. Sixty percent of our employees would be gone, because they wouldn't need them. So about seven years ago, we started searching for a partner. It was up to the shareholders, of course; the board didn't own 51% of the shares, so the shareholders had to decide whether to sell the bank. And we went looking.

We went to Glacier Bancorp, because they had four branches, kind of random ones in Utah, that they'd picked up through other acquisitions, and we knew they wanted to expand in Utah. Their model was to buy good banks with good people in good economies and leave them alone. And we thought, "If we do that, we can keep our employee base and grow at the same time. That's a win." It was a very stressful and exciting time, because, like I said, three banks inside Utah really, really wanted us. Glacier came in and made the best pitch to the shareholders, and it passed with 80-something percent, so it was really good. We had to change our name to take the "National" out, because we were no longer going to be a national bank. That's when we said, "Let's put 'Community' in, because that's really what we stand for."

Since then, because we added those four branches in Utah, we doubled in size overnight. We went from $300 million to $600 million. Now our next goal is a billion, and we're going to get there in the next two years. That's my goal: in the next two years, we're going to get past a billion. And then it'll be smooth sailing from there.

Becoming part of Glacier has had some advantages for our customers. Because of the footprint in the West, our customers can go to any of the Glacier divisions, and it's just like they're with us in Layton. Same accounts. You can look up all your information. You can use the ATM. There are something like 200 branches total they can go to.

[15:38] Chris Hatch: And how many banks is that operating through?

[15:40] Shelly Holt: There are 17 divisions: Oregon, Arizona, Colorado, Montana, Wyoming. We're all in the West. We're not in California, but we're in the rest of the Western states, including Nevada; there's one in Reno. And all of us are in really good economies, so that's going well for us. There are a couple of things we're able to do now. One, we can lend at a higher limit. Before, our limit was $7 million total; we couldn't go above that. Now we can go up to $50 million, and actually beyond that if we wanted. So we're able to do more for our customers, and that's when we really started growing, because we could do bigger loans without customers having to go somewhere else for that help. And we're also able to do a lot for our employees that we couldn't do before, because Glacier is publicly traded, so our employees can own stock. First National Bank was private. We had stock, but it was privately held. So it's been fun to see the employees be able to own stock in the company.

[16:43] Chris Hatch: Those limit increases are huge, especially in commercial development. That's one of the biggest downers out there, especially through this recent run-up in costs. Everything is a fortune to build anymore. Even these tiny little drive-thrus I work on are $2.5 to $4 million apiece, every time.

[17:03] Shelly Holt: And the last few years, we keep waiting for a normal year. Three years ago, interest rates went crazy. Two years ago, we were going to have six rate cuts; we had two, in November. And this year we're like, "Oh, everything's going to be fine. Everything's going to be mellow." And then, no. Life happened, and we don't know about these tariffs. I was at a Utah Bankers meeting a little while ago, and everyone said it's basically wait-and-see. We have some borrowers sitting on the sidelines, and some who want to go immediately because they're not sure what's going to happen. But we're doing really well this year. It's been a good year for us, knock on wood.

[17:40] Chris Hatch: Okay, so the merger with Glacier was...

[17:42] Shelly Holt: 2019.

[17:43] Chris Hatch: In 2019. So that was before you became president. And when you stepped in, could you tell what was up and down post-merger? It always seems to take a little while, right?

[17:56] Shelly Holt: You know that saying about the things you should never trust: "The check's in the mail" and "Everything will be the same after the merger." That's one of my favorites. But really, we kept a lot the same. Only five employees left us, and that's because we didn't need their positions. But they all had jobs before they even left, and we had severance and such for them. So it was very gratifying that we were able to keep so many of our employees. We had really good technology before, and the last few years Glacier has been working on the technology, so we're really coming up to speed on that. But besides that, like I said: same faces, same faces. Customers still come in and see us. Like you mentioned Kirk; he was just in the other day. A few weeks ago, we had a bunch of our employees together, and someone said, "You guys are all the same." And we're like, "Well, we're getting older, and we do have some new employees, but we're also still here."

[18:58] Chris Hatch: That's good. It sounds like here you are, six years post-merger, and you've been able to retain as many team members as you have. Seems like mission accomplished.

[19:09] Shelly Holt: As I mentioned, the era of lift... and my goal: I am the first female president. And I always say my goal was never to be the first female president. My goal is not to be the last. So what can I do? I just really want to put so much emphasis on learning and training and growing that they're going to be fine. Whoever comes after me is going to have exactly what they need. I've always liked to look toward the future from the past. What are we going to do next? But what's our foundation? That's what I try to remember, and that's what I try to do.

[19:49] Chris Hatch: So as you're zeroing in on the $1 billion mark in total assets, how does a bank grow its assets? Is it by attracting new customers?

[19:59] Shelly Holt: Yeah. If there were another opportunity for Glacier to buy someone in Utah, we could grow that way, which would be a lot faster. But really, it's one loan at a time, one deposit at a time. And it's so exciting when you get a new customer. My favorite thing to do is go out, like meeting you, and see these businesses. People are so smart and creative, and I'm like, "How do they come up with that?" I love it. It's my favorite thing: going out to businesses and seeing what they do and how they build. And then we get to do the fun part, which is help them build their dreams. We get the easy part. They're the ones doing the hard part. They're the ones who are so creative. That's what I love, and that's what's so brilliant. It's one customer at a time. It really is.

[20:45] Chris Hatch: Porter, Shelly has admitted that we're smart and that we know what we're doing building drive-thrus. We should probably just call the interview right now.

[20:52] Shelly Holt: That's a high note right there.

[20:53] Chris Hatch: That's right. This is George Costanza from Seinfeld. We end it on a high note and we're out of here. So, it's interesting to think about why somebody would shift their account from one bank to another. It does seem like the general sentiment, broadly across America, is that a lot of people are leaving the very large banks and going to more of the community banks. Is that what you see as well?

[21:18] Shelly Holt: Yes, and it's because of the attention. The products are the same. A checking account, a savings account; there are going to be tiny incremental differences. It's the people. Like I mentioned this morning, finding that weird thing on an account: it might have taken that business four or five more days to find the fraud. We found it the very next morning, because something went through and someone said, "That seems odd to me." That's what you get when you go to a smaller bank. You get someone who says, "Let me help you." Big banks are great for their locations and their ATMs and all of that, until there's a problem. When there's a problem, that's when we really solidify the relationship. There are so many examples, Chris, of people we've helped who tried to go to other banks and couldn't get any assistance, even from people they knew. They come to us, and we're like, "We'll help you figure this out." Even if they don't bank with us: "Let us walk you through the fraud process. Let us help you." And usually, the reason people leave their bank is that something happened that made them unhappy. Sometimes they come to us because of our community involvement and the things we're doing on that front. But a lot of the time, it's because we were able to help them in a situation.

[22:24] Chris Hatch: We were just going through my deal board while you were sitting in my office, and I was showing you the 92nd transaction we just closed. Owning 92 pieces of property, plus a brokerage and a property management company that manages for all kinds of third-party clients, means we have banking relationships with literally dozens of banks out of this office at the moment. And I would tell you the one absolutely sticky part about First Community Bank for me, the reason I would never go anywhere else on earth, simply put, is that my banker is the best banker I have ever worked with in my entire professional career: Mike Padovich. When you call him, he answers, right? It's so funny. Every time I need something from him... I guess every customer likes to think they're not the needy customer, and you don't really know until you've been told. But in my mind, I'm not a needy customer. Maybe Mike can set the record straight. In my mind, I need something about once a month or every other month. And I called him literally just yesterday, and he's at Bear Lake. He started laughing, and I'm like, "What, are you at Bear Lake again?" And he's like, "I told my girls on the way up here, 'Chris is going to call me.'" Every single time he's at Bear Lake on his time off, I call him and need something. I don't know what it is.

[23:41] Shelly Holt: He's relaxing. But I bet when he answers, he says, "My man." And then he just says, "What do you need?"

[23:47] Chris Hatch: Exactly. I said, "I don't need to bug you. Can I call someone else?" "No. Just tell me what you need, and I'll handle it." And honestly, because of that, I would never bank anywhere else. He's my preferred banker because of it.

[23:58] Shelly Holt: I remember our chief lending officer, Jason, a few years ago, was on the phone with a customer dealing with a wire situation at one in the morning. Jason and I were going back and forth, and it was one in the morning because it was overseas and he was talking to people there. That's just what you do. You pick up the phone. And we don't have phone trees. We have people who answer the phone and say, "How can we help you?" That's the difference.

[24:22] Chris Hatch: That personal touch really is an extra component, and I've got to imagine it's very difficult to maintain once a bank gets too big. Is that part of the reason Glacier has wanted to keep everybody in place? They want a bigger presence, but they also want to give the customer that?

[24:40] Shelly Holt: Yeah, they really do. Like I said: good markets, good people, good economies, and then they really let them run their show. People always ask me, "How often does Glacier interfere, or call you?" And I'm like, "Sometimes I can go quite a while without hearing from anyone." It's because they let you run. We do our thing and make our own local decisions. We set our own rates. We do our own loans. We really do run quite independently. But it's also good because you have their balance sheet. Like I said, we're able to lend higher amounts because we use their balance sheet instead of ours. There's this $20 billion behind it, and that's why we're able to do much larger loans. And then, as I mentioned, there are things we're able to do for employees that we couldn't do as a $300 million community bank. We can still be community, but we're able to do some really nice things for people.

[25:35] Chris Hatch: Fun. So talk to us a little bit about the business of running a bank. Obviously you're taking in deposits, and there are plenty of static deposits that sit there, whether it's a checking account or a higher-interest savings account or whatever. And more or less, you're turning around and loaning those out. If you look at the portfolio of what's loaned out at the moment with our bank, where are we loaned out? Is it primarily single-family residences?

[25:59] Shelly Holt: There's a lot. A high concentration in single-family, because we're Utah, and Utah has a lot of people who want to live here, a lot of families and such. So we have a lot in single-family, and a lot in hospitality. We always want to do more in the other, more diverse classes. But in Utah, for the last several years, it's been apartments, because housing is really hard to afford. And I still think, Chris, that the American dream is to own a home. I still think that's it. So the more we can do to help with that, for first-time homebuyers... I love that. When our mortgage people are on the phone and I can hear them talking to people who are going to get their first house, I just want to drive by and say, "Hi, you don't know me, but I work with your mortgage loan officer. I'd love to have dinner with you." That's my favorite thing, because I still think that's the American dream: to own a home. But yes, a lot of our loans right now are in multifamily and hospitality.

[26:58] Chris Hatch: Why do you think that's still the American dream? It is interesting.

[27:02] Shelly Holt: I still think it's there. You know, the immigrants coming over on the boat. The streets aren't gold, but they thought they were. So what do they want to do? They want to own, and have a roof over their heads and a place where their family can enjoy a meal. Maybe it's multigenerational because of the times, but to me that's still the dream: "I own a piece of property in this land." That's very, very important to me, and it still is. I look at my nieces and nephews, and they want to own homes. Have they missed their window? No, I don't think so. It'll come again. That's what I keep telling them: save, be ready, have a good credit score, and when the time is right, which will happen, you'll own a home. Everyone wants that little plot of ground. It doesn't matter how small it is; it's theirs. So that's still my version of the American dream, which I know goes back to Ellis Island, but it's still there.

[27:58] Chris Hatch: Giving your advice there, you very much sound like a banker. You went into banker mode. "It'll come around."

[28:04] Shelly Holt: I did a meeting with some youth, young adults, a little while ago, and a bunch of them asked me that question: "How do we get a home?" And I said, "Okay, let's talk about it. How can you get a home?" We really talked about what you have to do and how you have to prepare. To me, good luck is just opportunity meeting preparation; they all sync up. So I said, "You have to prepare now. Don't start saving for it when it's time to get a home. Save for it now. Work on your credit now. And then when the time comes, you'll be ready."

[28:37] Chris Hatch: So you took over the bank and got handed the reins in January of 2020?

[28:42] Shelly Holt: I actually took over the reins a little earlier, in December, because our president decided to leave. And I said, "Well, there we go. So much for the honeymoon period."

[28:51] Chris Hatch: Right. So you got a whopping 90 days of calm from December, and then a small little event hit the world in March of 2020. What was that like?

[29:00] Shelly Holt: COVID was so interesting for all of us, because we were considered essential. We were essential workers, and we had little badges made that said we were essential. We didn't have our lobbies open unless it was by appointment, but we had our drive-thrus open and such. And then we did PPP loans, which was really fun, to help. We got a lot of new customers through the PPP loans and were able to help businesses and, hopefully, save businesses. That was really exciting. But it was also really fun, because how much do you do when your lobby is closed? We cleaned a lot of closets.

[29:37] Chris Hatch: Oh, yeah.

[29:37] Shelly Holt: We did a lot of storage projects.

[29:39] Chris Hatch: A great moment to get all that stuff knocked out. Cleaning the windows. Digging through 25-year-old Halloween decorations.

[29:44] Shelly Holt: That building has been there since the 1800s. We had a lot of stuff to go through.

[29:51] Chris Hatch: Okay. So COVID hits, and you try to figure out how in the world you even function. Is society going to exist next month? Those thoughts were going through all our brains, right? And then we come out of that, and it's still a rocky ride in '21.

[30:05] Shelly Holt: But we had a lot of deposits because of PPP, and a lot of people wanted to start doing things again, so there was a lot of loan activity. That was really fun. Business was booming. Everyone wanted to do everything they'd put on hold. It was a really fun time to be in banking, because things were going well and people wanted to get out of their homes and see people and do things. So that was a good time. I actually enjoyed it.

[30:44] Chris Hatch: From my perspective, going into 2022, I'd describe that as the least fun year of...

[30:51] Shelly Holt: Was that the interest rate year?

[30:52] Chris Hatch: Yeah. '08 and '09 weren't very fun, either; don't get me wrong. I remember October of '08, the free fall in the stock market until, what, February? That was alarming, because, back to the point, is society going to exist anymore? It kind of made you wonder. But 2022 really wasn't fun. We were under construction on a whole slew of buildings, underwritten to a fixed spread on a levered yield-on-cost basis. Our lending rate was here, which was very comfortable. And then all of a sudden, within a few months, our lending rate was here. And you're looking at it going, "Huh. I don't know if this is worth it anymore."

[31:30] Shelly Holt: Right. That's exactly what happened.

[31:32] Chris Hatch: So what was that like for you?

[31:34] Shelly Holt: On our side, you'd think the banks must have loved it, because their loan rates went up. But what else happened? Deposit rates went up. You do this budget assuming deposit rates are going to be here. No, they're not. Deposit rates went up so fast and so high, and no one was prepared for it. We like to joke that our budget was out of date before we even hit January 1st, because the interest expense was so high. That goes back to what you were talking about, how banks make money: it's the difference between loans and deposits. All of a sudden, loan rates went up, but deposit rates went up even more. So that margin between the two... that was really, really hard.

[32:14] Chris Hatch: And what a rocky road, because the whole time you're trying to run these teams. Each branch has its own sub-team, right? And then of course you've got the corporate team at the main HQ. What a nightmare to run that budget.

[32:28] Shelly Holt: And really, you can buy deposits by offering high interest rates, but we really wanted relationships. So it was, "Okay, do we do this type of rate? Well, we'll do it if we can get the relationship." It's all about relationships, not transactions, and that's still our philosophy. Some people come in and say, "I want this rate," and we always look at the relationship. Do we have their checking account? Do we have their kids' accounts? If so, then we want to work with them because of that. But if it's just a transaction, people hop all the time. So, two years ago, interest rates were too high. Then we were waiting for the cuts, and nothing happened. And then, like I said, this year I'm like, "This is it. This is my year." And so far, so good.

[33:13] Chris Hatch: I was lamenting to you that the development equation hasn't become any easier to solve. The retailers we work with, their equation isn't any easier to solve either, right? Their labor costs remain high. Who knows what's going to get hit with a tariff or another import cost. Not to mention the general supply chain disruptions that have never recovered from COVID. It really has been a wild five years.

[33:38] Shelly Holt: It really has. That's why I've aged exponentially, I've decided.

[33:45] Chris Hatch: What's interesting about all of that is, during that time period, if you've figured out how to lift, the era of lift, right, it's really amazing. If you've figured out how to rise, how to encourage your people to be better, how to get revenues up and the bottom line up, that's wonderful. Real kudos, because if you've been able to operate through this, it's not been smooth sailing.

[34:09] Shelly Holt: It really hasn't. It really has been a rough time. That's why I said there was no honeymoon. I had no honeymoon period whatsoever. I jumped right in with credit quality and things like that right off the bat. So it has been very gratifying to see. And you just said the word "rise." We had a quarterly celebration in January, and that's what I said to them: "This is our fifth year of the era of lift. If you have not risen, now is your time to rise. This is our year to rise." And it's been really fun to see employees seize that, in different ways, in how they're learning and growing and bettering themselves.

[34:48] Chris Hatch: So when you get together with the 16 other bank heads at the Glacier level, is there a healthy amount of trash talk at these events?

[34:57] Shelly Holt: There probably is. I probably go to bed a lot earlier than everybody else. I can hear people coming in pretty late, and I'm like, "I know who that is," because I'm an early-to-bed kind of person. But yes, they do a "best of the best." And I swear, when we were at the lower end, the slide just stayed up there forever. And this last time, we were middle to top, and I'm like, "Well, that was fast. Why don't we linger a little longer, now that we're up there?" I think it's all perception. But there are just some great people out there that I love working with.

[35:31] Chris Hatch: But you're a competitive person. You want to be at the top.

[35:35] Shelly Holt: Yeah. It was funny, because in this meeting we had in January, we're trying a different strategy on new accounts from some of the other divisions. And they were like, "Well, we'll see how it goes. We'll look at this at the end of the year." So I sent a text to our marketing head, and I said, "We'd better do well at this. I'm not coming back here in December and saying we didn't do well." So yes, there is competition.

[36:02] Chris Hatch: Listen, from a marketing perspective, if I can step in for a minute: I love where we're headed. It's been fantastic. We were just chatting about that offline. It's been a lot of fun and entertaining, some of the ads and content we're pushing out there.

[36:17] Shelly Holt: Yeah. And I don't want to burst your bubble here, Chris, but I'm not very hip. So it's been kind of fun for me. They're like, "That's a reel." Okay. I thought "reel" meant it's real.

[36:28] Chris Hatch: But that's the thing. If you've got the understanding to recognize that's not your strength, and you've been able to make strategic additions to the team of people for whom it is their strength, that's it. You're hitting it.

[36:42] Shelly Holt: I always say, if I'm the smartest person in the room, I need to find a new room. I don't want to be the smartest person. I want to be the one who's constantly learning. And I love it. Usually as I go through the day, I'll look at the clock and say, "Okay, it's 10:30. I just learned something new." I love that. That's why we're here. I just want to keep growing and learning and see what happens.

[37:04] Chris Hatch: What do you see on the horizon as we look into the rest of 2025?

[37:09] Shelly Holt: I think things will calm down. I think the Fed will cut rates. I think they'll feel pressure to cut rates, probably in June. People were saying four times, late last year and earlier this year. I don't think it's going to be four times. I think they'll cut rates twice. We're going to continue to grow. Utah will continue to grow; that's why we have such a great economy. And I think things will calm down. When you're first in office, you have a flurry of stuff you're trying to get done, and then things calm down a bit. So I think we'll get there.

[37:47] Chris Hatch: I do think, with them forgoing the May cut, the longer it gets pushed out, the more fervor there should be whenever it comes back, right? And hopefully that translates directly into investor sentiment.

[38:01] Shelly Holt: Yeah. You read one article that says no rate cuts, and another that says yes, there'll be rate cuts. I think there will be.

[38:10] Chris Hatch: What are you seeing? You've got such great exposure to Utah business operators across all different sectors. What are you hearing from business owners as you're out there talking to them?

[38:22] Shelly Holt: Most of them are still very optimistic and still want to do things. It isn't like COVID, when everyone just put a lock on their door. I think a lot of people are still going. Maybe we have to sharpen our pencils a little on some things, but I think people are still building. They're still doing things. People want to progress. So we're doing great. We have a really strong pipeline, and a lot of people interested in doing new loans and such. So we're really, really optimistic. We're almost halfway through the year, one more month, but I think it's going to be a good remainder of the year. I really do. And I'm a positive person anyway, so I'm glass half full, or fill me up. But I do think it's going to be a good rest of the year.

[39:10] Chris Hatch: That's a good sentiment for the audience. We have a lot of people who are younger in the business who listen to these episodes, and one of the things I constantly get asked about, especially by young people trying to do development work, or maybe someone who knows retail or industrial leasing and wants to buy an existing property and partner with somebody and bring in some investors, is that they're always so intimidated: "Can I get a loan? Can I get a loan?" What's the best advice you could give an up-and-comer about preparing their balance sheet, or themselves? What can they do?

[39:46] Shelly Holt: You know what we would love? We love talking to people. So I'd say the number one thing is, wherever you bank, communicate with your banker. Tell them, "This is what I want to do in one year, two years, five years," and let them be your partner. That's the best thing. Sometimes we meet with people and say, "You know what, you're a year ahead of getting this line of credit. But here's what you can do in the meantime to get there." That's the best conversation you can have, and our loan officers love doing that all day long. And then you see them improving and getting there. Whatever financial institution you're with, let them be your partner. Do it together. Don't try to figure it all out yourself. This is our stuff; that's your stuff. You're good at your stuff, and we're good at ours. Let us help you. Just go meet with them and say, "Hey, do you have a minute? Can we talk about what I'd like to do?" Like I said, I've been to so many businesses that have had these creative ideas, and we're like, "Let us help you get there." So really, it's communication, which I think is the answer to almost everything. Communicate with your banker, talk to them, be a partner with them. You're not on opposite sides. You're both working toward the same goal.

[41:02] Chris Hatch: I love thinking about it as a partnership.

[41:04] Shelly Holt: It's a partnership. It is. It's not a transaction. It's got to be a partnership.

[41:08] Chris Hatch: And that goes back to the strength of a regional bank: developing a relationship with a person you know, whom you can meet with regularly, who's in your community, and then creating a plan.

[41:19] Shelly Holt: Yeah. I love it when I see our chief lending officer's mileage report: so-and-so, so-and-so, so-and-so. I'm like, "Yes, that's great." I love that. And the other part we haven't really talked about yet is the nonprofits. I love helping the nonprofits. I feel bad that there's a need for so many, because Utah's a great state with a great economy, and you wonder why there's so much need. But that's what I love to do. We're not big enough to name a stadium or sponsor a sports team or things like that. But what we can do is 200 dinners for Thanksgiving. We can do things like that, and that matters to me. That's the cream on top of the Diet Coke. There's no cream on Diet Coke, but I'm just saying that because that's what I drink.

[42:06] Chris Hatch: Depends whether you go to Swig or somebody. Depends what's in it.

[42:10] Shelly Holt: But to me, if I can help this child... We do the [Young Living] event and go out shopping for these kids, and we always spend way too much of our own money, because we just want them to succeed and be their best selves. I love that. That's what I mean when I say I want the business part to just run itself and do well, and then we get to help the community and grow our employees. Those are going to be my golden years.

[42:40] Chris Hatch: Which are coming up soon.

[42:41] Shelly Holt: Which are coming up soon.

[42:41] Chris Hatch: Well, I like that. So you've got the era of lift, followed by the golden years.

[42:46] Shelly Holt: Yeah. I'm getting up there.

[42:51] Chris Hatch: Okay. That's funny. Back to the young lending proposition. When I first started buying commercial real estate, I didn't quite understand what it was, and I think most people don't. I think that's what drives the questions that come in to me occasionally. I used to think I had to have X amount on my balance sheet, and that I could then only borrow half of X, or three-quarters of X. What's so fascinating about commercial real estate is that by about the time you've taken your second or third loan, you've vastly eclipsed anything on your balance sheet, because commercial real estate is so expensive. So whether you have loan three or loan 300, it doesn't matter. What you owe is so much greater than what you have. So it truly is a relationship business.

[43:38] Shelly Holt: It is. And I love that as a community bank, you have a toolbox. You can go help construct a loan. It doesn't have to fit inside this one parameter. It's like, "This is a little different. Hey, what if we do this? What if we do that? Let's try this." We did a loan last week, and the way our lending people decided to structure it, switching collateral from one property to another, I would never have thought of. I was like, "Brilliant. Let's do that." So there are lots of different ways you can work things out. But again, it's the partnership between the banker and the business.

[44:14] Chris Hatch: Partnership and thoughtful communication.

[44:16] Shelly Holt: And really thinking outside the box. That's one of my favorite things about our lenders. They're like, "Let us get back to you on that. Let us think about it for a bit." And then they come back with these great ideas.

[44:30] Chris Hatch: I do think it helps that we're in a wonderful community, in a great state that's thriving. There are so many great things to talk about with the state of Utah.

[44:39] Shelly Holt: I love it here. I know we're getting more people and more traffic and such, but it's still a really great place to live. I'm very proud of our state.

[46:05] Chris Hatch: Look, it's been great to get to know you over the last year, like I said. It's been a lot of fun. And I think what's really cool is that you can feel your energy coming through in this podcast as you talk about your team, this era of lift, and now these golden years you've got coming in the future. You can feel your energy. You truly have a passion for running this team and doing what you're doing.

[46:35] Shelly Holt: And part of that is because you give some things up. There are only so many hours in a day. And I always ask myself, "Has it been worth it? Has it been worth the journey I've been on?" And it's worth it when... last Friday, I was at the leadership academy, seeing these people, their ideas and their questions. We talked about trust, we talked about loyalty, all these great things, and they're coming to you like you're the Dalai Lama or something. And I'm like, "Well, I don't have all the answers, but let me tell you what I think." It's just wonderful. I love it. I left that meeting last Friday just flying. I had a great day. It was really fun. And it feels like there's quite a bit of difference in our ages, but I just think, "Oh man, the future is bright." I'm not worried about the future. I know some people worry about the next generation, that they're going to be on their phones all day and not learn how to read. But I'm telling you, the future is bright.

[47:42] Chris Hatch: Let's hit that next generation for a minute. In my household, I'm raising two boys and three girls. It's clear the three girls are running everybody's life and the entire family, especially the oldest one. As we go into the teenage years, and heaven help us, we're going to have a second teenager in January...

[48:01] Shelly Holt: Here we go.

[48:03] Chris Hatch: It's been interesting running a household with these strong female personalities in it. Sorry: attempting to run a household. Did I say running a household?

[48:12] Shelly Holt: You did.

[48:13] Chris Hatch: Let's rewind that one. We all know who's in charge of my house. It's my wife, for sure, and then my daughters. But it's been interesting. And I think Utah has had a very slow-to-react demographic. I'd imagine when you get together with other banking heads in the state of Utah, the vast majority aren't female. Is that a correct statement?

[48:37] Shelly Holt: That's very true. In Utah, fewer than 10% of CEOs in general, not just in banking, are women. It's even less for banking. In the United States, it's 7.5%, which is really low; it's not even double digits. And only one of the heads of the 50 largest banks is a woman. I don't know if it's because banking has always been maybe a little more male-traditional, with finance and accounting. More women generally work at banks than men, but not at the higher levels, you would say. I think part of it has to do with the unknown of finance. It just sounds like it's going to be difficult, but it's really not. To me, finance is like everything else. It has to do with communication and relationships and figuring it out.

[49:28] Chris Hatch: What is it like to be the head of a bank as a woman?

[49:33] Shelly Holt: I used to go to meetings and count the ratio, and it was always 10%. The women were always about 10% of the room. I wish I could say that's really changed over the years, but it really hasn't. I know that back in Washington, there are women-in-banking groups, allies, forum groups and things like that, trying to increase the number of women. To me, it's always just about the best person. And with the people I work with, my team, I have never felt less or different or anything like that. Through the years, though, I did have... I'll tell you about one time, and I still remember this. This was years ago. A man came by a meeting I was in, and he said, "Who's presiding at this meeting?"

[50:20] Chris Hatch: Well, that sounds like a church question in this state.

[50:23] Shelly Holt: He said, "Who's presiding at this meeting?" And he was implying that, because I was a woman, I couldn't be the one presiding. I turned to him and said, "I am." And then I just went back to the meeting. I still remember that to this day. And then one of my predecessors told me, before I became president of the bank, obviously, "Our bank will never have a female president."

[50:48] Chris Hatch: He told you that?

[50:49] Shelly Holt: And when this all happened, I seriously wanted to go and say, "Remember when you told me our bank would never have a female president?"

[50:56] Chris Hatch: And to that, I'd like to say, in a very articulate manner: ha.

[51:00] Shelly Holt: That's my response. That's it.

[51:02] Chris Hatch: And then maybe gift him one share of Glacier Bank. You know what I mean? "Now you can be a stockholder in a company that has a female bank president."

[51:12] Shelly Holt: Because to me, it's always about the best person. Who cares what color, gender or ethnicity? I don't care. I want the best person with the best ideas.

[51:21] Chris Hatch: I wholeheartedly agree with you. And as you well know, in our office, the majority of the people who do retail are women. I generally think women are much more inclined to just be better at the retail business than men are. For example, when I sit down with a rookie agent who's brand new to our office and ask, "Where's the closest Target?", not only do they know the closest Target, they know the cosmetics manager's name. They know that Target doesn't carry a certain product, for whatever reason, and it's really annoying, so they've got to go to this other Target to get it. They know everything, right? Whereas I can sit any of these young guys down, and they're like, "I don't know. I think my mom goes here." So, to my point, I generally prefer hiring women, because of the knowledge base most women in Utah, in my experience, have in their heads. It is interesting. It's still difficult, though. I have a hard time identifying new candidates for our office in general, and finding ones I think might be good who are women has been a challenge for us.

[52:30] Shelly Holt: There's a quote I've had for years and years. I wish I could remember who said it. It says, "Before becoming somebody's wife, before becoming somebody's mother, become somebody." That's always stayed with me. Before you get these different labels on you, become somebody, and everything else will come from that. That's what I've always tried to do. People have told me before, in different meetings and things, "You're different." And I say, "In a good way, thank you." In a good way, right? We did presentations for Glacier back in January, and some people came up to me and said, "Yours was so different from everybody else's." And I said, "I decided from the very beginning that I was going to be myself. And if that isn't good enough, that's your issue, because I'm going to be myself. I'm not going to be someone else." I'm not everyone's cup of Diet Coke, but I'm just going to be me. I want to be genuine. Then you don't have to put on airs. You're just yourself.

And my passion is our people. Our employees, really. And then our customers, as relationships, not as numbers. I had an experience last week where someone asked me about a conversation they'd had with someone, and they said, "What did I do wrong in this conversation?" I said, "You forgot the person. You had the numbers, you had the data, you had all that, but you forgot the person. And you never forget the person." The person comes first, and everything else will come from that. That's how I like to live my life.

[54:08] Chris Hatch: I love that. What a great way to wrap up today. For anybody out there listening who's been enjoying this: if you're in the state of Utah and you're not totally satisfied with your banking relationship... Shelly's not putting in the plug, so I'm going to. You need to check out First Community Bank Utah. Her top-down leadership, where she's developing people, is evident at every layer of the company I've seen so far. Tremendous employees, absolutely top-notch team members. People who are doers, who get it done and put the customer first. So it's worth checking out the bank.

[54:43] Shelly Holt: Oh, thank you, Chris. That was very nice.

[54:46] Chris Hatch: No problem. We appreciate you coming on the Dirt Dog Pod today.

[54:51] Shelly Holt: Thank you. Maybe I'll do another one someday.

[54:55] Chris Hatch: We'd look forward to having you back. Let's hit the billion, and then we'll have you back. That should be like next month, the way you're headed.

[55:06] Shelly Holt: I'll be back. I'll be back. Thank you so much.