S2,E13 - Dave Kavney

This is Talk CNY, presented by NBT Bank, a semi-monthly podcast by CenterState CEO, Central New York's premier leadership and economic development organization. Join us as we meet the people and explore the projects driving the regional economy forward.

This is Talk CNY, presented by NBT Bank. I'm Katie Zilcosky, director of communications at CenterState, CEO, and your host for Talk CNY. When you think of a bank or any financial institution, you probably think of a physical building, a place to manage your money, maybe an ATM, and that is all a part of it. However, our financial institutions are doing so much more from supporting our nonprofits to financing the projects that help us grow. Take this podcast, for example, presented by NBT Bank Making this show possible is one of our financial institutions here. On this episode of Talk CNY, I'm joined by NBT Bank's Dave Kavney. He's the regional president of the Central New York and Mohawk Valley Regions. He's here today to talk to us about the financial institution's role in the regional economy and how NBT Bank is an active member of our community. Well, Dave, thank you so much for being here with us today.

Katie. It's great to be here. Thank you. Yeah.

So you have been in commercial banking for over 30 years, a long time, Central New York resident. So with all of the growth and change that is happening in the region, can you kind of put it in perspective for us both from a perspective of a financial institution and as a Central New Yorker?

Absolutely. Actually, I was just thinking about it. As you mentioned, 30 years. It'll be 35 in two months. Oh, congratulations. I'm aging out. It's been great. It's certainly an exciting time in Central New York, both as a resident and from a business perspective. I've been a lifetime resident of Central New York, and I've loved it here. If you think about our natural resources, the Adirondacks, the Finger Lakes, I've raised a family here. I've got several siblings and my parents still here, and it's been fantastic. And I think as I've gotten a little older, I've appreciated what we've got here. That's been a little bit of a hidden gem for quite some time. That's fantastic. From a business perspective, we are seeing some really exciting times, and I think obviously the talk of the day is the Micron announcement and how that's all going, but we've really seen a transition here in central New York and across upstate for many years. GlobalFoundries has really started this chip corridor situation across upstate New York over in the Albany area, up in Malta, and then with Utica, with Danfoss and Wolfspeed. We've seen a lot of development, a lot of excitement, a lot of growing companies in those regions. So I know what's coming. We've seen it and there's been a blueprint for it. I'm really excited about Central New York going forward. For sure.

I mean, can you explain for some of our listeners how banks fit into this regional economy picture? How are you guys enabling this growth? Some of these expansion projects?

It's hand to hand. We are working very closely with our customers. Again, we've seen the need for housing in other areas where we've seen growth of what's coming to Central New York. We've seen some of the commercial and industrial companies have needs for equipment, new buildings, expansions, working capital. So we work very closely with our customers and we have a lot of discussions really try to understand what their needs are, their challenges, and we don't really have a cookie cutter approach, but we do try to work with each of them individually and get to where we need to be to help them succeed in business for sure.

You mentioned seeing some of this kind of happen previously in other regions. I mean, can you describe what you've seen before and how that's impacting your approach to Central New York now?
Yeah, great question. We do have somewhat of a blueprint, and if people have been paying attention to the other parts of the state, they can actually see what's coming. But as an example, in Utica, there's been, the Wolfspeed plan is now up and running for a couple of years. Employment is, I think, exceeding initial expectations or at least on track to meet them early. Danfoss is growing. The hospital has expanded downtown with the New Wind Hospital. We've seen a lot of residential, multi-family real estate projects, which we're part of. We've had several customers that have come to us from a commercial standpoint needing increases in lines of credit. Again, new equipment expansions of their businesses. So we've been right there ready to work with them, financing that.

So a lot of growth comes with challenge as you kind of hinted at before as well. So what are some of the challenges that you're kind of navigating at this time?

I think the challenges we're navigating are what we're hearing from our customer base, and that is really, there's an increase in labor costs and there's no, I'm sure you're hearing that a lot of folks talk to. We're hearing that across the board. It started a couple of years ago, and it's putting some earnings pressure on some companies, and there's still a shortage here in Central New York. And then another focal area for us has been, we do a lot of real estate lending. So the cost of construction has gone up immensely. There'll be some talk about interest rates that have gone up, and yes, they've gone up since covid, they have, but we're not at a historically very high interest rate point. So it's really, I think, been the cost of the labor within the companies or the construction processes that a lot of customers are going through. This is a pretty big inflection point for us here in Central New York. So we at CenterState CEO, and the whole region are really trying to put our heads together and figure out ways to move forward together and maximize this growth opportunity. One of the ways we're doing that is through our affinity groups. They're still in their early stages, first convening, still establishing, but one of those groups is a financial affinity group that NBT Bank is a part of. So could you tell me why it was important for you to take on this voluntary step to be a part of this group and really work through some solutions?
And that's a great question. In all honesty, the cooperation is what makes us create as a community. I mean, a lot of these banks compete against each other every day, and we have for years. However, what's going on here and what's going to happen is much larger than a bank or a couple of banks. So working together with my peers at other financial institutions is critical. I'm learning every day. Like I said, I've been doing this for 35 years. There's still things I don't know. So we're having some great discussions and we want to be prepared as we go forward to help those companies that are going to locate here, that are going to grow here and succeed here. We want to collectively help them be in the right spot for that.

Yeah. Are there things that you can share that you have learned or things that you're hoping to learn more about through this process and these conversations? Yeah.

I was out in Boise, Idaho, last September and had an opportunity to work to meet was some of the economic folks in town, some real estate developers, and really wanted to try to understand what's happened out there over the last, well, 40 years since Micron, I think was formed in a basement of a dentist office 40 years ago. But we did see, and there's a lot of great companies out there. It's not just Micron, but we wanted to see what we were going to be, what we'd expect to see here as we go forward. There is exactly what we've been talking about. We saw a need for housing, workforce development. We really need to get ahead of the housing and workforce development situation in Central New York. That's going to be critical, and I think we all need to work together and learn from each other, collaborate, cooperate, cliches, I guess. But we really do need to do that to be successful and help these companies going forward.
I mean, you mentioned that you do typically compete against each other, but cooperation has been a big part of moving forward together. So how are you kind of working through and navigating that balance?

Central New York is not a huge community. So we've, like I said, 35 years, I've been working alongside many of these people in other areas, and we all get along really well. We're competitors, but we're friendly competitors, so it makes it really great. Healthy rivals. Exactly. Exactly.

Well, we will be right back with more with Dave, but first we have a word from our presenting sponsor, NBT Bank.

What I'm looking for in a bank is one that's looking out for me, like NBT. I want a relationship and a team that supports me and my dreams like NBT. And let's face it, life can get challenging. I need a bank that's focused on me. They've been rated tops in all the things that matter, like trust, customer service, and financial advice. So when I need a bank I can trust. It's always NBT and me.

This is Talk CNY, presented by NBT Bank. I'm Katie Zilcosky, director of communications at CenterState CEO and your host for Talk CNY. Joining me today is Dave Kavney, regional president at NBT Bank. Dave, thank you so much for being here today.

Absolutely. Glad to be here.

So if people are listening, they've probably figured it out. Our presenting sponsor, NBT Bank, you make this whole show and series possible. So we really do appreciate that in your work helping us produce this.

We're proud to do it. Thank you. And for people listening, maybe they just listened to the main series, but there's also a quarterly market insight with Ken Entenmann, who is your chief investment officer and chief economist at NBT Bank. So for someone who hasn't taken the dive into the Quarterly Market Insight episodes yet, what can they expect from Ken? What can they expect to learn from him?

I would really recommend someone listen to one of Ken's episodes. The quarterly insights are fantastic. Ken has been with our bank a long time. He's a resident of Central New York. He's really in tune with what's going on across Central New York and can really break down the economy on a larger scale, global, national level, and also bring it much closer to home. So those that have heard him really like to hear Ken's quarterly insights. If you haven't, I would really encourage you to do it because you might learn a little bit from Ken. I'm sure you will.

Yeah, absolutely. They are great episodes. In support of things like our podcast here. It's one of the many ways that financial institutions like NBT Bank are critical supports for nonprofits. I mean, NBT Bank was the business of the year community impact winner for such supports. So can you tell me a little bit about NBT Bank's work in the community? I mean, you have a big partnership with On Point for college just to name one of the ways you're involved.

Yeah, one of the interesting things with NBT is we are regionally structured. So Central New York, we've got a team of people that get together to think about where we invest our dollars, where we sponsor and the sponsorship with CenterState for these podcasts is critical because all the great work that's being done here is fantastic. We wanted to make sure everything's being communicated. You've had a lot of business owners on, Ken Entenmann on, and that communication we feel is critical. Our work with On Point started about a year ago. We helped fund for multi, multi-years of career advisor position. This was on the heels of the Micron announcement because we initially understood through talking with different constituents that the workforce development was going to be a major issue, and we really want to see everyone in Central New York succeed in that. So the career advisor position, he works in both Utica and Syracuse with the city school districts, and they really try to guide students into some post high school education focused on the technology industry because we want to make sure that when these jobs are created and when they're ready to be populated, that our own folks from here in Central New York are ready to do that.

So that became something we focused on early, On Point does a fantastic job working with high school students, post high school students, and we thought it was a great partnership. With respect to our philanthropy and sponsorships, it's grassroots. We've got an awful lot of people in our bank that are involved in boards, different organizations, and we think that's very important to support what our employees are doing. So I was just on the phone with our team in Oswego the other day, and they wanted to sponsor an event in Oswego and they got behind it. They're going to have volunteers there and really become invested in it, and it's important to that market within Central New York. So that's how we work it, and it seems to be working really well for us.

I mean, this work is all beyond the scope of maybe what someone considers traditional financial institution work. So why is it important to do and why is it beneficial for you as well?

That's a great question. We are a community bank, so we're headquartered in Norwich. We're in seven states, but our headquarters is what, 45 miles to the Southeast. We really understand that NBT Bank, like many other organizations, is only going to be as successful as the communities in which we operate. So we think it's important that we help drive that success.

And I mean, I'm sure you've seen that kind of in turn through all this work that when you see communities grow, you yourself see that success. It's a shared success. That's right. That's right. Yeah.

So, we have well established this is a period of growth for us and change, and that means that we all have to take time to change ourselves. So how do you see NBT Bank evolving and changing with the times in the near future?

We are constantly looking at how we do things and how we can do them differently, keep up with changes. If you've got customers of NBT that are listening right now, we are doing an awful lot of work, unfortunately with fraud prevention and identification. And that's something that our customers have needed, and we are working very closely with them. We are constantly looking at our technology. If you think about it, we've got an awful lot of companies in Central New York that are technology based. We talk a lot about Micron, but there's a lot of others that have been here a long time and continue to grow, and they're fantastic community partners. So we're always looking at our technology to make sure we're keeping up with what our customers demand. So it's really, in my opinion, the market that demands change. We're trying to stay ahead of that curve to really address those needs upfront.

Now, what is something that keeps you excited about your work, both in a financial institution and in this region?

I would say watching our customers succeed. In all honesty, if we are financing some new equipment or a building for a customer and there's a ribbon cutting and the owners are there and the press is sometimes there, it's fantastic. To know that we've helped that business succeed, which then employs maybe hundreds or thousands of people, and that in turn helps our community succeed. So it's this circuitous situation that I just think is fantastic, and over the years as I've gotten a little bit older, bringing in some younger bankers to learn to try to carry that tradition going forward is also makes me feel real good. I really like working with some of our younger team members.

So if you could put on a crystal ball cap, let's say, and look maybe 10, 20 years into the future, how do you hope that Central New York kind of actualizes itself?

I hope we look back and those that are still critically involved with business here say, this community did it right. The cooperation and collaboration, I know I already used that, but it's so important that no one area is going to handle what's coming to us and themselves. So we really need to get behind it? We need to have some forethought into what's needed before it's needed. We've got a blueprint from other areas, and I think it's all in front of us, and I hope we get it right, and I think we will. I'm excited. Yeah.

It is. It's all very exciting. Well, Dave, thank you so much for your time today. We really appreciate you coming on.

Absolutely, Katie. Thank you.

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