2016 Outstanding Women in Banking: Nichol Beckstrand

Minnesota bank president turns innovation into reality .Nichol Beckstrand has taken a less-than-traditional route to the president's office at Sunrise Banks, St. Paul, Minn. She hasn't ever been a lender. Yet, she was just what Sunrise needed in a leader as it looked to expand its products and diversify its revenue away from traditional products like commercial loans..Since Beckstrand became COO of Sunrise Banks' in 2006, the bank has started a national prepaid card payments division, created gift card partnerships with major retailers, and launched innovative consumer lending products. With Beckstrand now leading as both president of Sunrise Banks and of its holding company, University Financial Corp., the bank also is well on the way to its goal of earning 50 percent of its revenue from fee income..Beckstrand is a 2016 selection for Outstanding Women in Banking honors. The recognition, sponsored by CliftonLarsonAllen, is presented by NorthWestern Financial Review magazine..Beckstrand's background in internal audit and compliance, in addition to her experience with enterprise risk management and corporate governance, give her an edge when it comes to forging ideas for growth and income diversification..Her expertise in these areas comes from her background in public accounting. Beckstrand graduated from the University of Minnesota, Minneapolis, with a degree in accounting in 1996. Her first job out of college was at Larson Allen Weishair and Co. – now CliftonLarsenAllen – where she worked in audit and compliance. Her specialization in banking allowed her to become a partner in six years – record time for the firm..ERM is essential to a well-run bank, even more so for a bank pursuing innovative products, Beckstrand said. "Twenty-five years ago, the biggest risk for a bank was credit risk and making bad loans," she said. "Today, credit risk is a part of the risks we consider but there are so many other risks that could have a much bigger impact for the organization if not managed well.."The delivery of financial products is an example," she added. "No longer are financial services delivered hand to hand; it is device to device now. For a single product, you can now have compliance risk, legal risk and cyber risk in addition to credit risk.".Beckstrand and Sunrise CEO David Reiling have an "innovator-implementer arrangement," Beckstrand said. "He is the visionary who goes out and establishes great ideas and concepts," she said. "I vet the concepts for plausibility, risk and the hurdles we'd need to overcome to make it happen. It totally fits with my background.".Often Beckstrand's analysis has found that Sunrise needs to partner with other firms in order to launch new products. Here again, Beckstrand's prowess for corporate governance is a boon to Sunrise Banks. "We look to partner with firms that connect to the customer where they are," she said. "The role we play is the dependable bank behind the scenes. We are their partner that does compliance, money movement and governance very well.".The $777 million Sunrise is the 13th-largest issuer of prepaid cards and gift cards in the country. It has achieved that rank by partnering with companies that supply large retailers with gift cards. Sunrise's partners supply Lowes, Home Depot, Casey's General Stores and other retailers. Sunrise also offers prepaid cards to bank customers from its branches in the urban core of Minneapolis and St. Paul..Another example of Beckstrand's skill as an implementer is a small dollar loan program called TrueConnect, which the bank launched in 2014. TrueConnect is a consumer installment loan offered in partnership with employers as a part of an employee benefits package. The loans are delivered through employers' payroll systems using proprietary software designed by Sunrise Banks and its technology partner..Reiling is chair of the Consumer Financial Protection Bureau's Community Bank Advisory Council. He and Beckstrand worked to design TrueConnect in line with the bureau's expectations for new regulations on small dollar lending. An employee who borrows through TrueConnect pays installments to Sunrise from their paycheck. On average, for a $1,000 loan, the employee pays $11.82 a month in finance charges; that's significantly less than a payday loan of $1,000 which can cost $300 per month..At the end of 2015, Sunrise Banks was honored with a NEXT Awards for Opportunity Finance by Wells Fargo for TrueConnect. The award came with $2.2 million to expand TrueConnect. The program, which was started in Minnesota, Ohio and California, now operates nationally..With Beckstrand managing product expansion and revenue diversification, the bank's fee income to assets reached 4.77 percent in the second quarter, according to the FDIC. The average ratio of fee income to assets at Minnesota banks is 0.78 percent..Other 2016 Outstanding Women in Banking honorees include:Karen Gregerson, The Farmers Bank, Frankfort, Ind.Tirzah Wedewer, F&M Bank, Manchester, IowaSusan Koranda, Security Bank, Laurel, Neb.Jan Odin, Unison Bank, Jamestown, N.D.Leann Stessman, Park State Bank, Minneapolis