Norm Bagwell, Chairman and CEO of Bank of Texas, and Executive Vice President of BOK Financial, discusses Bank of Texas’ preparation to sustain essential operations in the wake of COVID-19, its largest charitable gift in history, and the pandemic’s lasting economic impacts.
This Q&A is part of an ongoing series of DRC interviews with representatives from our member organizations about how they are facing the COVID-19 pandemic.
Q: The COVID-19 pandemic unfolded quickly, and left little time for companies to prepare for a significant disruption of day-to-day operations. How did Bank of Texas tackle this challenge internally to sustain operations and keep employees safe?
A: We have invested heavily in our resiliency plans over the past several years. Hurricanes, floods, and tornadoes provided real-time experiences that helped us test our capabilities across our eight states of operation. By the end of February, our Emergency Operations Center was focused on what would become COVID-19. As an essential business, it was imperative that we remain open, keep our people safe, keep the workplace safe, and continue to serve our clients and communities.
One key initiative was the rapid deployment of a work-from-home strategy for the bulk of our workforce. Other strategies were used to create safe work environments for jobs requiring in-person operations. Our human resources and facilities teams used a number of tactics to keep track of potential hot spots, separating work teams, adjusting shifts, and managing accordingly. Communication was enhanced in real time, and designed to keep our people and clients constantly informed. We also had to remain diligent and nimble so we could respond to evolving scenarios. For example, what we faced in Texas was different than what we were seeing in Arizona, Colorado, or New Mexico.
Q: How has Bank of Texas supported communities, both nationally and locally, in the wake of the crisis?
A: Our foundation has continued to be active with the not-for-profits in our portfolio. We made a special COVID-19 contribution of $1 million in support of our various markets across the country. Last week in North Texas, we announced a $100,000 donation in partnership with the Communities Foundation of Texas and the Get Shift Done for North Texas program. This contribution is focused on helping displaced food industry employees and feeding those in need.
On a larger scale, Bank of Texas and BOK Financial mobilized to support small businesses through the Paycheck Protection Program. We were open for business the first day and experienced no issues serving or responding to client needs. We processed more than 6,500 completed applications and exceeded $2 billion in SBA loans.
Q: What lasting impacts do you think this crisis will have on the financial services industry? How will the industry, and the larger economy, recover from this unprecedented downturn?
A: I think various stimulus plans have attempted to buy the economy 4-5 months of breathing room. If 70% of our economy is driven by consumer spending and more than 30 million Americans are out of work, I do not see a quick return to anything close to normal for the consumer or consumer-driven businesses. As a proxy, some experts suggest it will take the S&P 3-4 years to return to 2019 earnings levels, which suggests we have a long road ahead. There are now fundamental and complex issues in retail, travel, transportation, tourism, energy, health care, and even sports – and all of these businesses are important to Texas. I worry that the pain will reverberate through the economy for some time versus a hope for bounce back.
The good news from a banking perspective is that banks are in very good shape and able to support whatever scenario emerges. Our industry is very well capitalized, liquidity is strong, and earnings streams are diverse. These characteristics will enable the sector to be supportive of our clients through whatever we face. It is a much improved industry situation from what we faced in 2008-2010.