John Barbalaco
Chief Banking Officer, DR Bank
Age: 40
Industry experience: 19 years
Four years after selling its online student loan refinancing business, DR Bank still works in the financial technology space, providing full-service banking and lending-as-a-service to fintech firms. But for Chief Banking Officer John Barbalaco, the term “old fashioned” often comes to mind when describing the community bank’s approach to doing business. Barbalaco has spent his career working at community banks and joined DR Bank 10 years ago as a commercial lender. He became chief banking officer in 2017.
DR Bank was founded as Darien Rowayton Bank in 2006 and got into student loan refinancing in 2013 with the launch of what would become Laurel Road. The bank itself took on the Laurel Road name in 2018 and then changed it the following year to DR Bank after selling the student financing business to KeyBank. DR Bank has about $508 million in assets and two branches in Darien and Rowayton.
Q: What distinguishes DR Bank?
A: What’s great about DR Bank is that you have a lot of the same people that have been here for years and years. Although we’re an old-fashioned community bank to a certain extent, we’re pretty nimble in terms of how we get things done. Our focus, especially over the course of the last year or so, has been to try to enhance our digital capabilities for the bank with enhancements to our website and online banking profile. We have a great following from a lot of different people that can literally bank anywhere on the planet.
Now what we’re trying to do is really just deepen those relationships – not forget about who got us to this point today but try to make it where we can continue to grow with them and really become that much more of a partner for them, rather than chasing the next big thing. And we’re going down different roads with fintechs and trying to bank some of them and get up to snuff with the capabilities that a lot of those fintechs or some of these other innovative companies would need at this point.
Q: What can DR Bank offer in a market that has seen a lot of disruption?
A: I am part of a progressive generation; however, I do see the importance of being old-fashioned, where you pick up a phone and you speak to someone. With everything that happened with Silicon Valley Bank and Signature Bank, as a native New Yorker and being very close to a lot of people that worked at Signature Bank, that hit very hard. One of the things that we did that following Monday was to have an all-hands-on-deck meeting and just talk about what we needed to speak about with the customers. I had a multitude of different meetings with different depositors – big and small – during that day, as did everybody across the bank. I think that there is some comfort where you’re not just a ticker symbol or something along the lines of one of these major behemoth banks. Really, you are a face.
Q: Was the bank able to bring on new customers following the bank failures?
A: Somewhat. There were some people that brought us additional deposits. I would say that we didn’t really lose, nor did we really benefit. Conversely, a lot of the larger “big four” banks really benefited just because everybody said, “All right, too big to fail – I’m going to throw all my money in Chase.” Although I’m a lifelong community banker, I do understand it, and I can appreciate it. Unfortunately, that’s been the impact to smaller banks throughout the country at this point. We’re fighting that narrative, and it’s unfortunate.
Q: Is it possible for banks of your size to continue and compete in the current environment?
A: I 100 percent think that there’s such a necessity for us. And we can compete, and we do things better than a lot of the larger banks. We know the communities that we’re in, and we understand them. I think of things in an old-fashioned kind of way. Even with a movie like “It’s a Wonderful Life,” which is one of my favorite movies, you have George Bailey where he’s building these houses and he’s supporting the community, and then you have the other side of it where it was Mr. Potter. It was kind of like a microcosm of exactly what goes on in the world today.
Q: Are there other goals that you have for the bank?
A: I’m very loyal to this place. I’m deeply invested in its future. The brand is very important to me. I’ve been involved with it for a very long time, and, especially after taking over the marketing piece over the last four years or so, it’s been near and dear to my heart. We did a lot of great things during the pandemic. We did over $90 million of PPP loan originations with a team of basically seven people. I thought that was a great feat for a smaller bank. It’s really something that I feel like more people should know about.
And in addition to that, we have a lot of different things on the horizon where we can really get into different spaces, be a disrupter and really move quickly and be nimble. Specifically, on the commercial lending space, we’re highly competitive with all the banks in this area, big and small. I want to continue to replicate that throughout the bank
Q: What did the bank do to improve Community Reinvestment Act performance last year from “needs to improve” to “satisfactory”?
A: We enacted a strategic plan when we were with the student loan debt refinance company. For a company that was basically lending nationwide, it was always going to be hard for us to meet goals within market because we were doing so much out of market. From there, you put different parameters in. You have to meet small business goals and community development loan goals. Then there was a residential mortgage component; we’ve since eliminated that piece. We have CRA activities, and then we also have investments. I oversee the small business and community development loan goals, and over the course of the past five years or so, we’ve actively monitored and managed that to a fault every year to make sure that we’re absolutely all over it.
We benefited from doing a lot of PPP loans, so we picked up a lot of in-assessment-area customers, which has been great. We’ve also expanded our relationships with a number of different organizations to expand community development loans within market to aid different fund programs and different loan programs. We don’t intend on going backwards by any stretch of the imagination, and it is a focus of mine. The more that we can help people, the better.
Barbalaco’s Five Favorite Vacation Destinations:
- Belmonte Calabro, Italy
- Disney World
- Montauk
- North Shore of Hawaii
- Laguna Beach, California
