00:00I'm Diego Sanchez, president of HousingWire, and this is 10 Minute Talks.
00:12My guest today is Jake Ryder, and he's the CEO of the Mortgage Division at Granite Bank.
00:19Jake, thank you so much for joining me today on 10 Minute Talks.
00:22Yeah, thanks for having me, Diego.
00:26Before we dive in, could you briefly introduce yourself and Granite Bank?
00:31Sure, I'd be happy to.
00:33So I'm Jake Ryder.
00:35I am happy to be a lifelong community banker who has now really gotten deep into the mortgage
00:40business.
00:42And my background in banking started from an early age, proud to grow up with my dad
00:48being in banking.
00:50He actually himself didn't grow up in banking, grew up on a dairy farm, but he spent his
00:58whole professional career in banking.
00:59So I knew from a young age that that's what I wanted to do.
01:03So I ended up following in his footsteps, got into it really on the commercial side
01:07of the bank.
01:09And over time, worked at a couple other banks, came back to join my dad.
01:14And that was right around the time that he had made the leap of faith from going from
01:20working for another bank for a number of years to really working to acquire a bank of his
01:27own.
01:28And so that kind of dovetails into the story of our bank is one where we're a 123-year-old
01:36bank, but we're really first generation in terms of my family's ownership of it.
01:42And so it's really been a fun ride.
01:45I get to work with my dad, two of my younger brothers every day.
01:49And we came in and acquired this bank in 2015 with a small group of investors.
01:56And it's been since that time that we've used the platform to stay true to who we are as
02:01a local community bank in central Minnesota and in the Twin Cities, but then also expanding
02:07more broadly into the mortgage space on a national basis.
02:12Yeah, let's talk more about that.
02:14So what's the geographic footprint on the retail banking side?
02:20And then we can talk a little bit more about the mortgage business.
02:23Sure.
02:24Yeah.
02:25So our roots go to Cold Spring, Minnesota, which is a small town outside of St. Cloud,
02:29you know, about an hour and a half west of the Twin Cities.
02:32And so our headquarters are there.
02:34That's where a good chunk of our retail presence is in central Minnesota.
02:37And then we're also in the Twin Cities metro area.
02:40That's where we do a lot of our commercial banking, depository, things of that nature
02:44is done there.
02:46And so you've already talked a little bit about pushing into mortgage.
02:52What does that look like?
02:53Yeah.
02:55So it really came about kind of through, I would say, just, you know, seeking out opportunities
02:59and coincidence about, I'd say, eight years ago or so.
03:04We happened to get to know an IMB in the Twin Cities.
03:08And it was through that experience they were looking for some banking relationships.
03:12And we ended up doing all the construction financing for them.
03:15And it turned into a really big line of business for us.
03:19And I got to see under the hood of a business that's seemingly doing the same thing that
03:23we are, but they were doing it in a different way.
03:26I call it a mortgage attitude compared to maybe what you're accustomed to, you know,
03:31what bankers are known for as maybe being less urgent, maybe a little more conservative.
03:36And I, yeah, I was kind of taken aback by going, there's a whole nother way to do this
03:41business that doesn't come at the expense of the community bank.
03:46And so we got to see how it was done differently.
03:50And we set about at that time knowing that we were going to basically take the best attributes
03:55of what an IMB is and the best attributes of a community bank and pull those things
03:59together and try and be something that's different and unique, you know, both on the banking
04:04side of the world, but then also in mortgage.
04:07And so that fast forward, you know, building relationships through that has enabled us
04:14to kind of build that from, I would say, the ground up.
04:18I'll back up though, like our bank has been doing mortgage for, you know, over 40 years,
04:23you know, it's your typical community bank with an LO in the lobby.
04:28And so we have a lot of the things set up for that.
04:30It was just taking it and getting set up to go on a much broader scale nationally while
04:36still keeping that local footprint from a retail banking standpoint.
04:39Right.
04:40So let's unpack that a little bit more.
04:42I would imagine that you have a sort of a distributed retail presence sort of in the
04:50areas that you are a community bank in, but then it sounds like you have something that's
04:55more national in scope.
04:57Is that pushing into the wholesale channel or what are you doing on a national scale?
05:01Yeah, I would say mostly retail.
05:03I think, you know, right now I'll still say that, you know, two thirds of our business
05:07has taken place in Minnesota, in the surrounding states.
05:12But we do have the ability now as we're growing in our operational headquarters and everything
05:17else is in Minnesota.
05:18So I'll be clear about that.
05:21But as far as the ability to go into markets where we maybe have some clients where they're
05:26buying a second home in Arizona or Florida, we'll be able to go into those markets and
05:33also provide the mortgage lending services there.
05:36I think the platform, of course, as a bank, it gives you the ability to lend into other
05:41states and so we've been able to leverage that as well.
05:44It's purely from a retail basis, not on a wholesale channel at all.
05:50When you're lending in places that are outside of the bank's geographic footprint, are you
05:54doing that through a partner or are you getting licensed in those areas, in those states?
05:59Yeah, we're getting licensed in those areas and in those states, yeah.
06:04That's really interesting.
06:05And so as you think about your team of originators, are you trying to push originators into some
06:16of these other geographies or are you originating with your team that's based in your geographic
06:24footprint?
06:25Yeah.
06:26So it's really been those that have come to us saying, hey, we're local to this market.
06:32We're looking for a partner that might fit what we're about.
06:34And I think being a smaller company that does have maybe a different type of business model
06:41and aspirations has we found to be attractive.
06:45People may be coming from a larger company that want a smaller, more of a family feel.
06:49And so that's what I think we've found is that people maybe come from other geographies
06:54and then they will want to work for us.
06:56So for us, to be able to open, say, a loan production office in another state is something
07:03that has been advantageous.
07:05And so that's been a more recent thing, I would say within the last 12 months, really.
07:09But that's how we're growing.
07:12And are you taking all the mortgages that you do wherever they are and are you putting
07:17them in your portfolio and servicing them or are you putting them out in the secondary
07:22market?
07:23Tell me how that looks.
07:24Yeah.
07:25The vast majority are going to the secondary market.
07:29We still have what we call our common sense portfolio underwriting.
07:33We still do that, particularly in our home markets, your backyard community lending.
07:39That's something that we have done and will continue to do.
07:43Do you have aspirations to be a big lender someday in mortgage and to kind of like climb
07:51the ranks in distributed retail?
07:54How are you thinking about this mortgage business?
07:56Yeah.
07:57It's one that I think is full of opportunity.
08:02We're going to be smart about it.
08:04I think growth for the sake of growth might come at the detriment of your company, your
08:09company culture.
08:10And so we do want to grow.
08:13We do have aspirations to climb that ladder through distributed retail, but do so in a
08:20way that's smart and that's incremental and one that ultimately is fruitful for the bank
08:27and promotes the bank at the same time that it is just mortgage.
08:31So they go hand in hand.
08:33But we started doing this with rates skyrocketing to their highest level in years.
08:39It's kind of been fun doing it in an environment where that's really all we know.
08:44And so we see this as something where we're built to do that.
08:48And it's now, I think, top of the funnel for the bank in terms of we'll be able to capitalize
08:53on other lines of business because mortgages, I think it's one of the greatest points in
08:59a relationship with a client where they're making their biggest life decision.
09:04And so you're able to do so many other things that are value adds as a bank.
09:09Could we see Granite Bank move a retail presence into some of these other places if they start
09:16to be markets that are doing really well for you from a mortgage perspective?
09:22Well, coming off of being a negative 25 degrees in Minnesota just a couple of weeks ago, I
09:27think that there's some markets that I wouldn't be opposed to maybe having a more permanent
09:33retail presence.
09:34It's certainly a possibility.
09:37There's no immediate plans to.
09:39But I think we're ones that take opportunities as they come.
09:45We don't just say no to things.
09:47We want to be thoughtful about everything that comes our way.
09:52So last question, because we're right around the 10-minute mark here.
09:57Tell me a little bit more about working with your family.
09:59I could see pros and cons to doing that on a daily basis and mixing your life and your
10:07work.
10:08Yeah.
10:09I think I'm one of the really fortunate ones.
10:11It's one of the greatest blessings I've ever had.
10:14The ability to mix work and family, it becomes one and the same.
10:18And yeah, we talk shop outside of work, but it's always done in such a way where we have
10:25a mutual respect for one another.
10:27And so I do recognize that that's maybe the exception, not the rule.
10:31And so it's been fun to kind of share a dream with my dad and also with my mom, with my
10:37brothers and to be able to honestly just have a platform to be an entrepreneur.
10:44We all don't take that lightly.
10:46And so it's pretty cool.
10:47It's like the American dream.
10:49You get to do it with your family.
10:50You get to build a business.
10:51And it's been a really wonderful thing.
10:55Well, Jake, thank you so much for, again, joining me on 10 Minutes Talks today.
11:00This has been a really interesting conversation.
11:02Yeah.
11:03Thanks, Diego.
11:04Appreciate it.
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