Granite Bank started as a community-focused institution, but under the leadership of Jake Reiter, its mortgage division is expanding beyond Minnesota. In this episode of Ten Minute Talks, host Diego Sanchez sits down with Jake Reiter, CEO of the Mortgage Division at Granite Bank, to explore how the first-generation family-owned institution is making waves in the mortgage industry. Jake shares the strategy behind the bank positioning itself for national growth while maintaining the personalized service that sets community banks apart.
Diego and Jake dive into the family dynamics behind the business, the role of company culture in scaling a business, and the evolving landscape of mortgage lending. With insights on Granite’s strategy to prioritize partnerships, culture, and an entrepreneurial mindset to fuel sustainable growth, this episode provides valuable lessons on scaling a business the right way.
Diego and Jake dive into the family dynamics behind the business, the role of company culture in scaling a business, and the evolving landscape of mortgage lending. With insights on Granite’s strategy to prioritize partnerships, culture, and an entrepreneurial mindset to fuel sustainable growth, this episode provides valuable lessons on scaling a business the right way.
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00:00I'm Diego Sanchez, president of HousingWire, and this is 10 Minute Talks.
00:12My guest today is Jake Ryder, and he's the CEO of the Mortgage Division at Granite Bank.
00:19Jake, thank you so much for joining me today on 10 Minute Talks.
00:22Yeah, thanks for having me, Diego.
00:26Before we dive in, could you briefly introduce yourself and Granite Bank?
00:31Sure.
00:32I'd be happy to.
00:33So I'm Jake Ryder.
00:35I am happy to be a lifelong community banker who has now really gotten deep into the mortgage
00:40business.
00:42And my background in banking started from an early age, probably grew up with my dad.
00:49He actually himself didn't grow up in banking, grew up on a dairy farm, but he spent his
00:58whole professional career in banking.
00:59So I knew from a young age that that's what I wanted to do.
01:03So I ended up following in his footsteps, got into it really on the commercial side
01:07of the bank.
01:09And over time, I worked at a couple other banks, came back to join my dad.
01:14And that was right around the time that he had made the leap of faith from going from
01:20working for another bank for a number of years to really working to acquire a bank of his
01:27own.
01:28And so that kind of dovetails into the story of our bank is one where we're a 123-year-old
01:36bank, but we're really first generation in terms of my family's ownership of it.
01:42And so it's really been a fun ride.
01:45I get to work with my dad, two of my younger brothers every day.
01:49And we came in and acquired this bank in 2015 with a small group of investors.
01:56And it's been since that time that we've used the platform to stay true to who we are as
02:02a local community bank in central Minnesota and in the Twin Cities, but then also expanding
02:07more broadly into the mortgage space on a national basis.
02:12Yeah, let's talk more about that.
02:14So what's the geographic footprint on the retail banking side?
02:20And then we can talk a little bit more about the mortgage business.
02:23Sure.
02:24Yeah.
02:25So our roots go to Cold Spring, Minnesota, which is a small town outside of St. Cloud,
02:29you know, about an hour and a half west of the Twin Cities.
02:32And so our headquarters are there.
02:34That's where a good chunk of our retail presence is in central Minnesota.
02:37And then we're also in the Twin Cities metro area.
02:40That's where we do a lot of our commercial banking, depository, things of that nature
02:44is done.
02:46And so you've already talked a little bit about pushing into mortgage.
02:52What does that look like?
02:53Yeah.
02:55So it really came about kind of through, I would say, just, you know, seeking out opportunities
02:59and coincidence about, I'd say, eight years ago or so.
03:04We happened to get to know an IMB in the Twin Cities and, you know, it's through that experience
03:10they were looking for some banking relationships.
03:12And we ended up doing all the construction financing for them.
03:15But it turned into, you know, a really big line of business for us.
03:19And I got to see under the hood of a business that's seemingly doing the same thing that
03:23we are, but they were doing it in a different way.
03:26I call it a mortgage attitude compared to maybe what you're, you know, accustomed to,
03:31you know, what bankers are known for is maybe being less urgent, maybe a little more conservative.
03:36And I, yeah, I was kind of taken aback by going, there's a whole nother way to do this
03:41business that doesn't come at the expense of the community bank.
03:46And so we got to see how it was done differently.
03:50And we set about at that time knowing that we were going to basically take the best attributes
03:55of what an IMB is and the best attributes of a community bank and pull those things
03:59together and try and be something that's different and unique, you know, both on the banking
04:04side of the world, but then also in mortgage.
04:07And so that fast forward, you know, building relationships through that has enabled us
04:14to kind of build that from, I would say, the ground up.
04:18I'll back up though, like our bank has been doing mortgage for, you know, over 40 years.
04:23You know, it's your typical community bank with an LO in the lobby.
04:28And so we have a lot of the things set up for that.
04:30It was just taking it and getting set up to go on a much broader scale nationally while
04:36still keeping that local footprint from a retail banking standpoint.
04:39Right.
04:40So let's unpack that a little bit more.
04:42I would imagine that you have a sort of a distributed retail presence sort of in the
04:50areas that you are a community bank in, but then it sounds like you have something that's
04:55more national in scope.
04:57Is that pushing into the wholesale channel or what are you doing on a national scale?
05:01Yeah, I would say mostly retail.
05:03I think, you know, right now I'll still say that, you know, two thirds of our business
05:07is taking place in Minnesota, in the surrounding states.
05:12But we do have the ability now as we're growing in our operational headquarters and everything
05:17else is in Minnesota.
05:18So I'll be clear about that.
05:21But as far as the ability to go into markets where we maybe have some clients where they're
05:26buying a second home in Arizona or Florida, we'll be able to go into those markets and
05:33also provide, you know, the mortgage lending services there.
05:36I think the platform, of course, as a bank gives you the ability to lend into other states.
05:42And so we've been able to leverage that as well.
05:44It's purely from a retail basis, not a wholesale channel.
05:48And when you're lending in places that are outside of the bank's geographic footprint,
05:54are you doing that through a partner or are you getting licensed in those areas, in those states?
05:59Yeah, we're getting licensed in those areas and in all states.
06:02Yeah.
06:03That's really interesting.
06:05And so as you think about your team of originators, are you trying to push originators into some
06:16of these other geographies or are you originating with your team that's based in your geographic
06:24footprint?
06:25Yeah.
06:26So it's really been those that have come to us saying, hey, we're local to this market.
06:32We're looking for a partner that might fit what we're about.
06:34And I think being a smaller company that does have maybe a different type of business model
06:41and aspirations has we found to be attractive.
06:45People may be coming from a larger company that want a smaller, more of a family feel.
06:49So that's what I think we've found is that people maybe come from other geographies and
06:55they will want to work for us.
06:56So for us, to be able to open, say, a loan production office in another state is something
07:03that has been advantageous.
07:05And so that's been a more recent thing, I would say within the last 12 months, really.
07:09But that's how we're growing.
07:12And are you taking all the mortgages that you do, wherever they are, and are you putting
07:17them in your portfolio and servicing them?
07:20Or are you putting them out in the secondary market?
07:24Tell me how that looks.
07:25Yeah.
07:26The vast majority are going to the secondary market.
07:29We still have what we call our common sense portfolio underwriting.
07:33We still do that, particularly in our home markets, your backyard community lending.
07:39That's something that we have done and will continue to do.
07:43Do you have aspirations to be a big lender someday in mortgage and to kind of climb the
07:51ranks in distributed retail?
07:54How are you thinking about this mortgage business?
07:56Yeah.
07:57It's one that I think is full of opportunity.
08:02We're going to be smart about it.
08:04I think growth for the sake of growth might come at the detriment of your company, your
08:09company culture.
08:10And so we do want to grow.
08:13We do have aspirations to climb that ladder through distributed retail, but do so in a
08:20way that's smart and that's a prevalent and one that ultimately is fruitful for the bank
08:27and promotes the bank at the same time that it is just more.
08:31So they go hand in hand.
08:33But we started doing this with rates skyrocketing to the highest level in years, and it's kind
08:39of been fun doing it in an environment where that's really all we know.
08:44And so we see this as something where we're built to do that, and it's now, I think, top
08:49of the funnel for the bank in terms of we'll be able to capitalize on other lines of business
08:55because mortgages, I think it's one of the greatest points in a relationship with a client
09:01where they're making their biggest life decision.
09:04And so you're able to do so many other things that are value adds as a bank.
09:09Do we see Granite Bank move a retail presence into some of these other places if they start
09:16to be markets that are doing really well for you from a mortgage perspective?
09:21Well, coming off of being negative 25 degrees in Minnesota just a couple of weeks ago, I
09:27think that there are some markets that I wouldn't be opposed to maybe having a more permanent
09:33retail presence.
09:34It's certainly a possibility.
09:37There's no immediate plans to, but I think we're the ones that take opportunities as
09:44they come.
09:46We don't just say no to things.
09:47We want to be thoughtful about everything that comes our way.
09:52So last question, because we're right around the 10-minute mark here, tell me a little
09:57bit more about working with your family.
09:59I could see pros and cons to doing that on a daily basis and mixing your life and your
10:07work.
10:08Yeah.
10:09I think I'm one of the really fortunate ones.
10:11It's one of the greatest blessings I've ever had.
10:14The ability to mix your work and family, it becomes one and the same.
10:18And yeah, we talk shop outside of work, but it's always done in such a way where we have
10:25a mutual respect for one another.
10:27And so I do recognize that that's maybe the exception, not the rule.
10:31And so it's been fun to kind of share a dream with my dad and also with my mom, with my
10:37brothers and to be able to honestly just have a platform to be an entrepreneur.
10:44We all don't take that lightly.
10:46And so it's pretty cool.
10:47It's like the American dream.
10:49You get to do it with your family, you get to build a business, and it's been a really
10:53wonderful thing.
10:55Well, Jake, thank you so much for, again, joining me on 10 Minutes Talks today.
11:00This has been a really interesting conversation.
11:02Yeah.
11:03Thanks, Diego.
11:04Appreciate it.