3 banking experts look forward to 2021

If there were a functioning crystal ball, it would have come in handy this time last year. The next best thing is talking to experts and asking their perspective, from experience, what can be expected in months ahead.

Fortunately, TBBW knew who to ask. In their own words, here are some forecasts from some of Tampa Bay’s leading banking experts.

Scott Daigle

Scott Daigle

Regional vice president for Tampa Bay, TD Bank

From an economic perspective, which industries ended 2020 on the best footing?

Worldwide, we have seen the negative financial impact of COVID-19, and specifically how the virus has affected small businesses, causing many to close their doors, limit their hours and pivot their operational models in order to maintain revenue and stay afloat in this challenging environment. Now, more than ever, companies are realizing the importance of emergency preparedness, and ensuring they have enough savings on hand, to weather unforeseen circumstances. While the travel and hospitality industries in Florida have struggled due to consumer fear of being around large groups of people and leaving areas where they feel safe and secure, some industries in Tampa are holding up well including medical businesses, professional services (legal and accounting) and child care. Medical practices, like dentists and physicians, have tailored their operating models to provide for social distancing, telemedicine and contactless protocol to ensure patients feel comfortable returning and do not delay important procedures. Professional services, like legal and accounting, have also learned to quickly, and efficiently, adapt to this remote work environment.

Moving into 2021, are there any economic opportunities that industry leaders should be aware of? 

Despite the COVID-19-related challenges, the Tampa Bay area continues to have a great number of economic opportunities on the horizon. These include recent wins for the Tampa Bay Sports Commission including Women’s Final Four, Men’s Frozen Four, Women’s Volleyball Championship and Men’s NCAA Basketball, which will bring a lot of traffic to the region. Construction projects remain on track including Water Street, Midtown Tampa and Westshore, in Hillsborough, and Clearwater’s new medical school and waterfront projects. Pinellas also recently finished the Pier and we expect downtown Tampa to continue to be a magnet for additional development. Tampa’s great outdoor spaces, which have proven especially valuable in this environment where people desire comfortable places to gather outside while socially distancing, coupled with its strong educational institutions and state-of-the-art medical institutions make it a great place to live and grow a business/find a job.

What is a realistic outlook for 2021? Recovery or maintaining? How much weight is being predicated on finalizing a COVID vaccine for the masses?

As it stands today, 2021 recovery will vary by industry but, overall, the economy will begin to rebound. Some industries are already experiencing strong recoveries and will continue to see growth. Food services and hospitality will also have strong headwinds. A vaccine will certainly calm the waters to ensure consumers are more comfortable returning to their day-to-day activities, but I do believe consumer habits have changed as a result of the pandemic and businesses have pivoted in response by enhancing mobile and online ordering, e-commerce, contactless check-in processes and leveraging drive-through capabilities. However, a vaccine will give greater confidence in returning food service and hospitality to their previous high points.

What are you hearing from your clients? What is keeping them up at night?

Hearing from our clients has been a bright spot during this time. We are talking more frequently, sharing information and their concerns have evolved week-to-week as government guidelines and the virus’ trajectory change. Our clients are becoming more comfortable with the “new normal”; however, the need to remain nimble and be able to adapt quickly and efficiently keeps them up at night as businesses have needed to constantly shift their operations as COVID-19 guidelines evolve.

Are there any “silver lining” stories you can share? Clients that took a bad situation and thrived?

Although many businesses have required financial relief during this time, there have also been businesses that have thrived. One of our customers, a staffing company that provides medical practitioners to government hospitals, has leveraged the importance of their company’s work to grow their business by three times during this period. They have used this obstacle to solidify themselves as a “go to” industry provider.

Ted Sheppe

Ted Sheppe

Executive vice president for commercial banking, Axiom Bank

From an economic perspective, which industries ended 2020 on the best footing?   

Housing continues to do extremely well, as does health care.

Moving into 2021, are there any economic opportunities that industry leaders should be aware of?    

We’ve advised that clients talk to their employees, customers and other stakeholders about new revenue streams, and new ways to do things better, and we have seen a lot of success. Unleash that entrepreneurial spirit. Restaurants adjusted to takeout, as an example, and have really mastered it. We believe 2021 will be marginally better due to (1) a vaccine and (2) companies have learned to live with the limitations brought on by COVID and (3) continued strong migration of households from other states to Florida.

What is a realistic outlook for 2021? Recovery or maintaining?   

Continued modest recovery. Slow and steady.   

How much weight is being predicated on finalizing a COVID vaccine for the masses?

A vaccine that works, and gets to people quickly, would accelerate this but I see this as something that takes a while to get to a large mass of people, meaning 2021 is really a slow steady recovery model.

What are you hearing from your clients? What is keeping them up at night?

Cautious optimism for the most part. The industries that are impacted most by COVID are losing a lot of sleep—hotels, restaurants, concert/meeting businesses and others. The biggest fear is a failed vaccine or a major surge in COVID that would cause either a formal lockdown or a de facto one by people being cautious.

Are there any “silver lining” stories you can share? Clients that took a bad situation and thrived?

Numerous. We’ve been inspired, daily, by the entrepreneurial savvy we’ve seen.. Finding new revenue streams, mastering new skills, like takeout for a restaurant, clever marketing ideas. The Black Rooster Taqueria, a Mexican restaurant, began offering Margarita-Grams. This is my favorite. You can send a card and a margarita to a friend, which is delivered. It created a huge awareness for them.

Our readers are predominately decision-makers, CEOs and other leaders in industry … what should they know that I’m not thinking to ask?  

Gather your employees and ask what you should be doing differently, better or new. You will be surprised at how many great ideas you get.

Shaun P. Merriman

Shaun P. Merriman

Regional president for West Florida, CenterState Bank

From an economic perspective, which industries ended 2020 on the best footing?

The best performers, from feedback from our commercial customer base as well as feedback from our peer groups, are businesses in information technology, consumer staples, general construction and construction materials, communication services and essential health care services. 

Moving into 2021, are there any economic opportunities that industry leaders should be aware of?

There will certainly be consolidation opportunities where weaker, less capitalized, but surviving businesses, will seek to partner up with stronger companies who provide a reasonable exit strategy for the owner(s). We are hearing that many businesses who were considering selling prior to 2020 will be looking to do so in 2021. This pandemic has certainly had its toll on small-business owners who were considering retiring by selling in 2020 but couldn’t do so because of a lack of management succession with family members or where an ESOP just wasn’t feasible.

What is a realistic outlook for 2021? Recovery or maintaining? How much weight is being predicated on finalizing a COVID vaccine for the masses?

I am not aware of any modeling being done regarding the rollout of a vaccine. We all know it’s in the foreseeable future, but most CEOs agree that the ascent out of this calamity is likely to be long, uneven and highly uncertain regardless of the timing of the vaccine due to the government’s involvement in its distribution prioritization. I recently read that the world economy has shrunk 4.4% in 2020. This is better than originally predicted, but nonetheless worrisome. I believe we will continue to operate in a recovery mode for most of 2021 and perhaps even into 2022.  This “improvement” can be directly linked to better-than-expected output in the United States, Europe and China after lockdowns were lifted. An approved, and effective, COVID vaccine will certainly drive a faster recovery. You can watch the various stock markets rally anytime there is positive news regarding a vaccine. That being said, it could take months before the true effects of a vaccine are felt in the business community.

What are you hearing from your clients? What is keeping them up at night?

Our clients are cautiously optimistic. Our customer base is predominately located in the state of Florida and, overall, they have done exceedingly well through all this. At CenterState, we got out in front of this pandemic with an “all hands on deck” approach to the PPP relief program with $1.3 billion in approved disaster relief loans to nearly 10,000 customers. This funding was critical to many service-related industries that were hit the hardest such as hospitality, tourism and retail. As a Florida-based bank, we are keenly aware of our exposure to these industries and are working closely with our customers to ensure they have the funds, resources and necessary payment deferments necessary to get them through this business interruption. Perhaps the single biggest concern that our customers are dealing with is the threat of a second lockdown [as of December]. We do not believe this will occur but it’s certainly weighing heavily on everyone’s mind as we see the COVID cases rise each day since the Phase 3 was rolled out.

Are there any “silver lining” stories you can share? Clients that took a bad situation and thrived? 

There are a couple silver linings to report. First. many businesses who have thrived during this pandemic have been able to increase their workforce and have had their best year ever, in terms of annual revenues. Secondly, this pandemic has forced many businesses, like ours, to accelerate digital platform initiatives. I would guess that we have moved our initiatives up five years as a result of this pandemic.   

Our readers are predominately decision-makers, CEOs and other leaders in industry … what should they know that I’m not thinking to ask? 

I truly believe that this pandemic has been a serious wake-up call for all industries and business types. I recently read an article in Inc. magazine that four key changes will be coming to the business world in 2021. They are: No. 1, working from home is here to stay; No. 2, physical office spaces will be reimagined; No. 3, major reduction in business travel will remain; and No. 4, the “digital transformation” will continue to accelerate faster than any of us could ever imagine. At CenterState, for example, nearly 90% of our workforce has been working remotely for the past nine months and we have managed to pull through this pandemic with excellent financial results and record-breaking revenue in key non-interest income generating lines of businesses such as mortgage banking, treasury services and correspondent banking. 

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