CEO Bruce Van Saun on how paying the Phillies $95 million put Citizens Bank on the map
Bruce Van Saun, who took Citizens Financial public 10 years ago, talks about Phillies naming rights, politicians' economic ideas, and the surge in U.S. millionaires.
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The day before he rang the opening bell at the New York Stock Exchange to mark Citizens Financial Group’s 10 years as a public company, chief executive Bruce Van Saun stopped in Philadelphia this week and talked about how he’s built a collection of merged Northeast and Midwest banks into one of the 10 largest U.S. branch banking companies.
To get the company’s name out in metro Philly, where Citizens absorbed a collection of local banks including the once-ubiquitous Philadelphia Savings Fund Society (PSFS), ATM pioneer Girard Bank, and Norristown’s Commonwealth Federal, Citizens in 2003 pledged to pay the Phillies $95 million for 25 years’ naming rights at its South Philly stadium.
In a wide-ranging interview in the bank’s Philadelphia offices at One Logan, Van Saun talked about how pro sports marketing pays off, the growth of America’s millionaire class, and the seeming immunity of the U.S. economy to partisan politics.
The interview was edited for clarity and brevity.
Your rival Wells Fargo recently made what it called “a business decision” to take its name off Comcast’s NBA Sixers and NHL Flyers arena, 30 years after its predecessor bought naming rights for their previous home, the Spectrum. You’re a lot bigger bank than you were in 2003. Do you want to extend your Phillies deal past its expiration in 2028?
Yes. We love the Phillies. They will always be our Number One. We also picked up a sponsorship with the [NFL New York] Giants, when we bought Investors Bank last year. So [16-year former NFL Giants star quarterback] Eli Manning is a spokesperson for Citizens now. He’s great. We don’t have our name on their stadium, but we are their official bank sponsor.
We’re the [NHL] New Jersey Devils’ bank, you see our banner on one of their entrance towers [at Prudential Center in Newark, N.J.] And we are the official bank for the NYC Marathon.
Will you bring the bike race, which was sponsored by your competitors, back to Manayunk?
We’re in early discussions with [former Philadelphia Mayor turned city biking advocate] Michael Nutter about resurrecting that.
And we don’t just do sports. We have all the music venues in Boston. The opera house. The rock clubs. Our customers get velvet-rope treatment. They can show up for shows early.
People don’t come into retail locations like they used to. Creating unique experiences, associating with topflight brands, has become increasingly important for getting our name out.
Are other companies besides Wells Fargo pulling back from sports just now?
Some companies that were paying top dollar in the dot.com era and the crypto era did go bust. The FTX Arena in Miami went bust [when founder Sam Bankman-Fried’s crypto-trading company was seized, and he was convicted of fraud]. If I were an owner, I’d rather go with an investment-grade company that will still be here in 20 years than sell for a higher price to someone who won’t be able to pay in five years.
How do you know stadium sponsorship works?
We measure the impressions and mentions we get in social media. It’s called “top-of-funnel impressions” that direct people to your name and your links, and you hope they will do business with you. It doesn’t translate directly to purchases. But there is a correlation: If your activity at the top of the funnel shrinks, your sales go down.
Your share price is up more than other banks this year. You’ve written down $300 million in commercial real estate loans, a lot of it for downtown offices where workers haven’t returned, but you have reported overall business and consumer loans are up and investment fees are up. With the Fed cutting interest rates, is the economy slumping or speeding up a bit?
We are ahead on our [sales and profit] targets. It’s going extremely well. [With recent acquisitions] we have a million new customers. We are a top-10 bank in New York. We focused on private-equity and technology businesses. We have recruited great middle-market bankers, so our capital markets fees are up, big.
So you’re going after the new millionaires, people in valuable homes, successful professionals, some who built businesses or sold one and diversified, or inherited wealth and added to it. That’s more than 20 million people, equivalent to more than one-eighth of the U.S. workforce, plus millions more who aspire to do that well.
Yes. Capitalism works!
Politicians warn that the American dream is in danger. Former President Donald Trump promises to expel millions of migrant workers, raise import taxes, cut corporate income taxes, and limit loan rates. Vice President Kamala Harris wants to boost taxes on higher incomes and tax capital investments.
We’re going through a political cycle where there seem to be a bunch of proposals geared toward attracting votes. It can be uncomfortable listening to some of those positions. My hope, for whoever gets in, there’s usually checks and balances. Voters seem to like divided government — a Democratic president but a Republican Senate or House, and vice versa. When you have to go through legislation and the budget process, these things should get trimmed, and sanity prevails.
The lack of fiscal discipline overall is on both parties. The level of debt to gross domestic product is approaching historic levels, which feels unsustainable. The parties have been [avoiding tough discussions] for awhile.
But many people have figured out how to make a good living under either party. Generally, business confidence is solid.
Why are foreign capitalists, not American investors, buying entities U.S. Steel and the Philly Shipyard?
There just aren’t a lot of people [in the U.S.] saying it’s time to go all in and put up a new factory. Look, we are the innovation engine of the global economy. If there’s a new-technology revolution, it’s being led by the United States. It’s being led by cloud-based artificial-intelligence and digital platforms, and digital marketing. That’s where the future is headed.
Some other countries we compete against are still basing their economies on heavy manufacturing. Their economies may have more patient capital, for industries not as exciting as AI and biotech. The Japanese and Koreans make the case they are our allies.
Our workforce is really key here. That’s why Dan Fitzpatrick [Citizens’ top Philadelphia area officer] is the chairman of the Workforce Development Board for Philadelphia County.
At the same time, with robotics, factories are automated. The better, high-paying jobs are running the automation.
How do you compete with the bigger New York banks and other national players?
There’s a lot of questions about scale: Can you compete with $220 billion in deposits when JPMorgan Chase has $3.5 trillion?
Competition is a good thing. You wake up every morning saying, how do I fight for my customers? We get it from the megabanks, and from the smaller banks like WSFS that are trying to get bigger, and from the fintechs that don’t have branches.
We have the scale to be competitive in commercial banking, as long as we stay focused on the middle markets, and we don’t try to be everywhere, and we are nimble. We have to do a great job for our consumer customers because Bank of America and JPMorgan are spending tons of money on technology and brand. JPMorgan has built branches all around Philadelphia, but they haven’t gained a lot of market share. And we are embedded in this community. It’s hard to replicate that for new entrants.