Laurentian Bank CEO forges new path for historic institution

Rania Llewellyn has never been one to shy away from a challenge.

She entered 8th grade as a 10-year-old. She graduated from high school at 14 and pursued a business degree because colleagues told her it was hard. She went from a part-time bank clerk to a top executive at Scotiabank, but made history when she left in October 2020 to join Laurentian Bank, becoming the first woman to lead a major Canadian charter bank. (Linda Seymour became CEO of HSBC Bank Canada the previous month, when it was not yet Canadian-owned).

“My husband always says, ‘Why do you always take the hard way?’ said Llewellyn from her office in Toronto’s financial district. “Although I saw this job as an opportunity I couldn’t pass up.”

Laurentian Bank’s headquarters in Toronto, in the heart of the city’s financial district, does little to detract from the organization’s lightning pace of transformation — the office is strangely quiet, thanks to Llewellyn’s 2022 decision to lay off the company’s 3,000 employees. to work from home permanently.

In just over two and a half years at the helm, Llewellyn has given the 177-year-old bank its most radical makeover to date, including a massive technology upgrade, a renewed focus on hiring employees from diverse backgrounds, and five new hires in executives. positions.

“I’ve always been drawn to transformational agendas and problem solving,” she said. “And I saw this as my chance to build the bank I always wanted to work for.”

Now Llewellyn’s bank looks very different from the Laurentian of five years ago, especially in terms of headcount. As she rolled out those updates in her first 18 months at the helm, the bank’s employee turnover rose to 33 percent — leading experts to question how much change is too much at a financial institution; especially now, in such uncertain economic times.

‘Remove prejudices’

Born in Kuwait, Llewellyn moved with her family to Egypt at the age of eleven and emigrated to Halifax five years later. After completing an MBA from Saint Mary’s University, she landed an entry-level job at Scotiabank, where she held a number of leadership positions, including vice president of multicultural banking and president and CEO of Roynat Capital, Scotiabank’s venture capital division. .

By 2020, she had built a reputation as a transformational leader – which Laurentian Bank, at least with regard to its technology offerings, desperately needed.

Shortly after he was appointed leader of Canada 10th largest bank, Llewellyn spearheaded the creation of Laurentian’s first mobile banking app, enabled tap payments on its debit cards, and partnered with Alberta-based fintech platform Thirdstream to enable customers to open an online bank account in minutes instead of days. Llewellyn said she was shocked that the bank had waited until now to develop those technical updates that competitors had implemented years and even decades ago.

“I thought, how are we going to keep our customer base if we don’t have the digital fundamentals?” she said.

Llewellyn went on to ban lending to oil and gas companies to promote sustainable practices; launched new annual reports that track the bank’s progress in achieving environmental, social and governance goals; Removed Canadian experience as a hiring criterion; and added diversity, equality and inclusion metrics on hiring scorecards: a step she describes as necessary to make Laurentian an equal opportunity employer.

“As humans, we want to hire people who are like us,” says Llewellyn, who remembers making coffee at a Tim Hortons in Dartmouth, NS, because she couldn’t find a job in her field after getting her business degree. She wondered if her maiden name – Zakaria Guindi – at the top of her CV was scaring off employers.

“Removing that bias from the hiring process promotes diversity of thought and allows for more creative solutions,” she said.

When those changes were made, however, there was an exodus of workers. More than 1,000 employees – one in three – left the bank during her first 17 months as CEO. Llewellyn claims this is roughly equivalent to Laurentian’s normal course, but it is much more than average turnover rate at US banks, it fluctuates around 20 percent.

Llewellyn said the high movement was due to a combination of attrition and performance issues.

“The change in leadership was a natural way for some people to opt out and say, ‘You know what? This is not in line, I’m ready to go,” she said.

Transforming time

Ian Lee, an associate professor at Carleton University’s Sprott School of Business, called Laurentian’s course unusual, even in a time of pandemic.

“One in three is very high churn for a bank, and certainly greater than what we typically see in Canada’s larger financial institutions,” Lee said, adding that other factors such as the pandemic, boomers retiring and an increase of poaching by the Big Five banks are also likely guilty.

Workers told the Star there were several reasons why so many workers left at once, and that the exodus began before Llewellyn’s time.

Audrey Holtz, who joined Laurentian’s Quebec headquarters as a consultant in August 2020, left her job after seven months because she grew frustrated with the company’s lackluster technical offerings. She said customers were annoyed that no well-streamlined app had followed the bank’s move to a cashless system in early 2020, and their constant frustration was stressing her job.

When Llewellyn took over as CEO in October 2020, Holtz hoped she would bring about change, but employees in her department quit by the day, and when her manager left the following February, she too jumped ship.

“There was pressure to sell what I felt was an inadequate product – almost every day a customer called and asked for their account to be closed because we didn’t have a good digital offering,” said Holtz, who joined the company shortly after leaving Laurentian Bank. battled with TD. .

“It’s good to hear that (Laurentian’s) technology is better now – I think this could have helped to keep a lot of employees employed earlier.”

Lee agrees that 2021 was high time for Laurentian to bolster his computing power.

“They urgently needed to develop new strategies – such as creating a better digital banking experience and giving employees the choice to work from home – so that they retain talent. If not, they would be left behind in a recession scenario as customers and employees seek out larger banks,” said Lee.

Two years later, the makeover seems to have worked: Laurentian has beat analyst estimates in nine out of 10 quarters since Llewellyn took over the reins.

Last year alone, earnings per share rose 14 percent, almost tripling the initial target of five percent.

During this period, the bank has reported that approximately 90 percent of its employees who have completed voluntary anonymous surveys trust senior management.

“You either have it or you don’t”

Kim Pernell, an assistant professor at the University of Texas who wrote her dissertation on banking regulation in Canada, predicts a tough year for the country’s financial institutions, fueled by rising interest rates, skyrocketing household debt and a lousy stock market.

Medium-sized banks like Laurentian, she said, are at particular risk, as shareholders tend to shift their investments to large institutions in tough economic times.

High turnover, Pernell said, can also drive some investors away by signaling dissatisfaction, and a loss of specific knowledge within a bank carried by long-term employees.

“Having said that,” added Pernell, “perhaps Laurentian needed a cultural shake-up, and their new look will attract new private savers. That could be a nice way to generate more income.”

Eric Provost, Laurentian’s executive vice president of commercial banking and who has been with the organization for 11 years, praised Llewellyn for bringing the necessary change to prepare the bank for economic challenges. He said a poorly executed shift to cashless banking early in the pandemic reflected an organization operating in silos, with little cohesion or accountability across sectors. Now he feels that the bank works more like a team.

“When Rania came on board she brought new energy and made things happen… you can feel the team is delivering now because they have the tools.”

Llewellyn said she recognizes Canada is facing unforeseen macroeconomic conditions: a possible recession with very low unemployment. She is confident that the new people she has hired, including new heads of technology, operations and personal banking, are the right people to tackle whatever lies ahead.

“We were looking less for technical competencies and more for the right DNA: people who are resourceful and resilient with an agile mindset,” she said. “I can’t teach you that – you either have it or you don’t.”

Llewellyn is confident that her fresh team — though smaller than competitors — has the right people to thrive in an economy still plagued by high inflation. Confidence appears to be going both ways: the high approval rate of its staff and the bank’s string of positive earnings reports indicate that Llewellyn’s efforts may not only have kept the bank afloat during the post-pandemic years, but also saved it for a collapse. fast changing world.

“I see myself as a keeper: I want to leave this place better than I found it,” she said.

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