Beyond news of interest rates and mortgage loans that dominate consumer banking, Catherine Ngo, president and CEO of Central Pacific Bank, is in the business of providing financial security and peace of mind for customers and shareholders alike

Not all business decisions are made on the golf course. Catherine Ngo, president and CEO of Central Pacific Bank, prefers a stand-up paddle session at Ala Moana Beach Park to center the body and focus the mind. From executive vice president and general counsel of Silicon Valley Bank in California, to founding general partner of Startup Capital Ventures in Hawai‘i, to her current leadership position at Central Pacific Bank, Ngo has gained invaluable experience across many facets of the financial sector. As Central Pacific Bank climbed to the fourth highest market share in Hawai‘i in 2016, Ngo is quick to point out that the size of the institution is not the focus. Success is measured through customer relationships, nurturing employees, supporting the community and exceeding expectations.

Have you simply taken advantage of opportunity as it presented itself to you, or did you set a goal to become a CEO?

Yes and no. It was not that I set my eyes on the role of CEO, but that I have always gravitated towards jobs where I believe I am able to truly influence and make a difference. Prior to joining Central Pacific Bank, I was a founding partner of a venture capital firm. As a venture capitalist, my goals were to influence entrepreneurs and build great companies. I never dreamed of one day being CEO of a publicly traded company. One of my goals throughout my career has been to constantly push myself outside my comfort zone. With that comes taking on more responsibility, resulting in moving up in organizations. I will also say that I believe part of it has been luck. I’ve had the benefit of doors of opportunity opening to me. So often, success comes from a combination of tenacity in pursing goals and luck with having doors opening at the right time.

As a woman in the male-dominated field of finance, did you find gender an obstacle to reach the top of the corporate ladder?

Of course. There were obstacles, especially early in my career. But if anything, they motivated me to push harder and work harder. Early in my career, I reached out to other successful women and men to be my mentors. With their guidance I learned I needed to be assertive and to never be hesitant. It was important for me to take on visible and impactful projects. I never let anything stand in my way. The mentorship I received early in my career has inspired me and made me feel it is now my responsibility to do the same for younger women early in their careers, in my company and in my community. I can never stress enough the importance of finding good mentors, especially for those young women that do feel they face additional obstacles.

Do you have career goals beyond CEO?

There are so many things I would like to accomplish as CEO of Central Pacific Bank. One of our largest initiatives, and something I am very passionate about, is our customer experience strategy. We launched this initiative in January of 2016. While we have already made some great strides towards our goals, I still believe we have more work to do in order to deliver an exceptional customer experience. Other goals I have for CPB are simplifying and automating processes within the bank, thus creating more time for us to focus on the customer, as well as leveraging technology channels for greater customer access and experience. I’m excited to work towards these goals with my team—a very strong team—and cannot wait to see where this will take us.

My other goal is to teach at the university level. I am passionate about teaching entrepreneurship and leadership. I believe it is so important at this point in my career to give back in the form of sharing my knowledge. I have no plans of slowing down. I’ve only just begun.

Are you involved with any community outreach organizations or nonprofits?

I serve on the University of Hawai‘i Foundation as a board trustee, treasurer and executive committee member. I believe in the foundation’s mission to raise philanthropic support, which will ensure the highest possible quality of education at the university and enable all qualified students to attend.

I also had the privilege of co-teaching a graduate level class on entrepreneurship at the university three years ago. The experience I had as a teacher that semester was one of the most gratifying in my entire career. While I do not currently have the time to teach at the University of Hawai‘i, my role as trustee for UHF allows me to support the student experience indirectly.

Are there any business programs or organizations that you feel women in the workplace should be a part of?

One thing I have noticed is women really do value the opportunity to network with other women. I think it is important for women to get involved with women’s organizations so they can build strong relationships. Early in my career I found other successful women to mentor me. And now that I am established in my career, I enjoy participating as a mentor at mentoring events. After these events, young women approach me to see if I would be willing to continue the conversation following the event. I always say yes. And from my experience, the other women participating in the events always say yes as well. So I encourage young women to attend mentoring and other networking events and put themselves out there. Ask to continue the conversation later

Any advice for young professionals?

I often share two pieces of advice that I believe are essential to young professionals. One—get comfortable with being uncomfortable. Growth happens when we step outside of our comfort zones. Personally, when I am comfortable in a role it means it is time for me to take on new challenges. And two—find great mentors to help and guide you. Mentors will help you see your strengths more clearly so you can leverage them. But more importantly, they will help open your eyes to your blind spots, and then, provide guidance on how to address these gaps.

Tell me about your business principles.

There are several key principles that I believe in, but the key principle that is most important is building trust. A leader cannot demand trust; it must be earned, even if that means being vulnerable at times. Trust also requires a high degree of core values including integrity and empowered accountability. Trust opens the door to more productive discussions, better decision making, stronger teamwork and a collaborative and enjoyable work environment. The fundamental principle of trust applies not only at work with your co-workers and customers, but also in the community and your personal life.

In 2016, CPB ranked fourth in market shares and deposits. How do you plan on maintaining or even increasing that standing?

Competition is undoubtedly strong in our industry, albeit at a very professional level among the banks in Hawai‘i. But, while we have grown in market share over the past several years, increasing the size of our company is not our focus. CPB’s focus is on increasing our core franchise value through strengthening customer relationships, nurturing employees who embrace our corporate culture, maintaining quality assets and supporting our community. Market share growth affords the benefits that come with economies of scale and is a critical metric for a successful business. However, becoming a larger company, in and of itself, does not drive the key focus areas of our organization.

How did the Great Recession affect CPB? And what has changed since then?

I believe CPB was the most adversely affected financial institution in Hawai‘i during the Great Recession, primarily due to our concentration of real estate development loans on the mainland at that time. Our company needed to recapitalize itself to the tune of $325 million dollars to remain in business as a result of our loan losses, which we were successful at executing in 2011. And, to the earlier point on market share, the recession provided a valuable lesson on the importance of quality over quantity. What has changed since our recapitalization is reflected in our company’s strong financial performance to date. We also positioned ourselves to repurchase approximately 27 percent of our common stock outstanding over the past three years, increase dividend payments, implement an incentive compensation program, and created a $13 million foundation to support our community regardless of the economic cycle we may be experiencing. Of course, with new management in place after the recession, we have a new outlook on our organization’s corporate objectives and culture.

Do you feel that rolling back financial regulation is the direction the banking industry should be heading in? What are your thoughts on the projected rise of interest rates over the coming years?

In concept, de-regulating the banking industry should reduce the high cost of regulatory compliance our industry is currently challenged with today, which could benefit both the bank and our customers. However, a practical balance must be maintained since banking regulations are primarily driven by consumer protection, whether it is for fair business practices or for the safety and soundness of the institutions that hold the consumers’ money. I believe that there are some excessive regulations that could be lightened as they were created in haste during the recession, which was triggered by the meltdown in the mortgage loan market.

As for rising interest rates, the impact is more obvious from the consumer perspective, whether you are predominantly in a borrowing or saving phase of your life. For banks, interest rate fluctuations should have less of an impact, since managing interest rate risk is a routine function of banks. We will see certain lending areas decline, such as residential mortgage refinancing, which has been a booming business during the low interest rate period. However, banks possess and manage a diversified asset portfolio with various types of loans and investment securities, as well as various funding sources such as deposits. The impact of rising interest rates for banks could be either positive or negative, depending on the bank’s current balance sheet composition, the aggregate sensitivity of the balance sheet to either rising or declining interest rates, and how well the bank manages their asset and liability portfolios relative to anticipated interest rate changes.

How do you balance pleasing consumers with your mission to grow profit margins for your institution?

That’s a great question, as pleasing our customers, or not, can make or break our company’s profitability. Interest rate pricing is important, especially in certain lines of business where consumers will shop, such as mortgage loans. However, we have found that while there are customers who are very price sensitive, there are also customers who place a higher value on service, trust and confidence in our bank. We don’t see our business model as selling products off the shelf. We are in the business of providing financial security and peace of mind to our customers. Loans and deposit instruments are merely tools to manage your cash and to leverage the growth of your personal assets.

We strive to balance what it takes to please both our customers and shareholders by focusing on building and strengthening customer relationships. There is no one formula, as customers will have different situations, challenges and needs. I believe that the common denominator is to understand our customers’ needs and to meet, or exceed, their expectations. If we succeed at elevating our customers’ experience, this will result in deeper customer relationships, and in the longer term, a stronger franchise value for our company, which will please our shareholders.