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Community Advocate of the Month: John Knellwolf, First National Bank at Darlington, Darlington

The following is a brief interview between WBA President and CEO Rose Oswald Poels and First National Bank at Darlington President John Knellwolf.

Rose: How did you first get into the banking industry?

John: Banking seemed like a natural fit for me as both my grandfather and father worked here at the bank. The bank was chartered in June of 1934, and I started work at the bank full time in July 1976 after graduating from UW-Madison where I studied finance and risk management. I had worked a couple of summers before that as a teller. My grandfather had passed away in 1970, but I was very fortunate to work alongside my father for several years before his retirement. I grew up in Darlington and really enjoyed the life that a small town offered so when the opportunity to come back to town and work at the bank presented itself, it was a very easy decision.

What us your favorite aspect of your role at your bank?

One of the most rewarding aspects of my time here at the bank has been working with customers on their borrowing needs. I really enjoyed sitting down with people, working through their financials, understanding what their goals were and then putting a loan package together that made sense for both the customer and bank. Our bank is focused primarily on agriculture and banking in a small town is generational. I see the grandchildren of many of the customers I worked with in the early years now coming into the bank for their deposit and lending needs. I moved out of the lending area a few years back and have focused most of my time on the overall management of the bank.

What do you wish the general public understood about the banking industry?

The face of banking has changed dramatically over the last 10 or so years. With the collapse of the housing market in 2008, regulators have been tasked with more and more mandates regarding safe lending and compliance. These regulations flow down into the banks and force extra work on both the bankers and the customers. Customers need to understand that a lot of the extra information that is now being required to open accounts and take out loans is coming from updated government regulations. While these regulations may seem intrusive to many folks, their goal is to maintain a safe and sound banking system in the country.

Where do you believe the industry’s greatest challenges are in the next 3-5 years?

I think the banking industry will face several challenges in the next 3-5 years.

One of the most challenging areas moving forward will be Information Technology (IT). There is a lot of cost and expertise needed to stay competitive. More banking is being done by phone and mobile apps. IT security is paramount and must be upgraded constantly. Finding capable personnel is a must. The pandemic forced many employees to work from home and this seems to be a way of life now and all of this means a greater focus on IT.

The second challenging area will be compliance. It does not look like community banks will get any respite from the regulatory burden. This will mean increased expense at the bank level as more employees are hired and trained to ensure compliance within their different departments.

The final challenge will be to manage the net interest margin. With a huge national debt and continued budget deficits, the Federal Reserve tries its best to manage the roller coaster of inflation and recession through their interest rate policies. Changing interest rates presents challenges for banks as they try to manage the pricing of their assets and liabilities.

Every day, bankers serve their local communities by helping their customers achieve their financial dreams. In addition, bankers also provide significant charitable support both financially and through countless volunteer hours. Please describe your current role at your bank and share with us one of your more rewarding experiences.

Over the years I have had the privilege of working with many community and volunteer organizations. The people involved all had the same goal; to make our community a stronger and better place to live and work. The friendships that have grown from these groups have been very rewarding. The same can be said of working with our customers. A recent interaction with one of my customers proved especially so as he was a veteran and needed some help on short notice. In addition to being a veteran, my customer was also trained in respiratory therapy. As the pandemic began to spread and expand, he was asked to work at a University Hospital in Illinois which was a COVID hotspot. In order to practice in Illinois, he needed to apply for reciprocity of licensure. The documents he needed (social security card, license, diploma) were in his lock box at the bank. It was a weekend and the bank was closed. We made arrangements to meet at the bank, access his lock box and get the records he needed. It was a very easy call on my part to help someone who in turn was going to help others.