Patriot Financial Partners’ Kirk Wycoff: Efficiency Gains Through Technology Will Decide ‘Winners and Losers’ in Banking

Sal Trifilio

Sal Trifilio

September 24, 2020

“We need to get that message across to the senior leadership team … as far as investment in technology, there needs to be a realization that the building's on fire.”

Kirk Wycoff doesn’t pull any punches.

As a managing partner for Patriot Financial Partners, he’s helped his firm make more than 70 investments in financial institutions over its 14-year history and has built a reputation as one of the top investors in the space.

It goes without saying that he and his team have been closely watching banks’ and credit unions’ responses to COVID-19 and technology has emerged as a key differentiator between institutions worth investing in today, and those that might be a risk.

That was the main takeaway from our Tuesday, Sep. 22 webinar where Kirk joined our insights team to talk about how capital markets are influencing bank budgets and strategies heading into the new year.

“Implementing financial technology to enhance operating margin inefficiencies, that’s one of the levers, I think, that’s left for our industry in 2021,” Kirk said. “How financial institutions get more efficient over ‘21 and ‘22 is going to separate the winners and the losers, in terms of earnings and in terms of stock performance.”

Over the course of our 30-min conversation, Kirk provided a behind-the-scenes look at how Patriot Financial helps institutions drive value through organic growth, as well as their roadmap to risk-adjusted returns for institutions they invested in.

More importantly, he provided an important gut check for banks and credit unions as they enter the new normal, post Paycheck Protection Program.

According to Kirk, record low interest rates coupled with an economy reeling from a once-in-a-generation pandemic has left financial institutions with little means for growth. Indeed, as he recounted during our fireside chat, increased loan production and efficiency gains are probably the only legitimate paths to growth left for institutions today.

Bank leaders “are fighting today’s fires, and in a pandemic, believe me, there’s a lot of fires,” Kirk said. The traditional model of banking “with the high cost of regulation and people and space” has created a situation where today “the building is on fire, and it’s burning while we’re in it.”

The solution? According to Kirk, “the fire department is technology.”

Watch our on-demand fireside chat with Patriot Financial Partners Kirk Wycoff above for more insights and, for more content like this, register for one of our upcoming Insights Sessions.

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