Rich Smith

Rich Smith.

Rich Smith

Managing Director of Originations in the Northeast at Bank OZK

Rich Smith
By November 9, 2020 9:00 AM

What’s been the biggest market lesson learned during COVID?

There are always unforeseen factors that can change the economic landscape pretty quickly. That is why we are consistently very disciplined in our credit underwriting. Our conservative credit principles have served us well over time, through both good and challenging economic cycles.

Are you bullish on New York City? If so, why?

I would say cautiously bullish. New York City has always been one of the first markets to rebound after recessions. Being the financial capital of the world, combined with everything else the city has to offer, will help it rebound again. The cautious part is that this virus is something we have never seen before. How will it change tourism, restaurants and hotels in the future? How will the office landscape change? These are questions that could take a couple of years to play out.

What’s key to New York’s rebound and recovery?

The key is time. Eventually New York will regain its vibrancy in terms of being a dynamic place to live, work and visit. People miss the energy, cultural amenities, arts, accessibility, the rich and diverse culture, and the history. There’s nothing else like it, and I believe we will rebound in due time.

In which presidential administration do you have more faith to see us through the post-COVID environment? Why?

I will stay away from political opinions here.

How are you winning the deals for which you’re competing most aggressively today?

We are winning deals the same way OZK has always won deals: relationship, expertise and excellence in execution. When many lenders were walking away from transactions in March and April, OZK closed all deals which were signed up. That’s the beauty of our long-term business model: We’re very disciplined in our credit underwriting, which allows us to operate pretty consistently. We’re thinking about the downturns before they occur, and we stay true to our conservative standards. That allows us to continue to operate “business as usual” while our competitors may pull back.

How has your loan portfolio fared through the pandemic? Any surprises during asset management in the early days?

The portfolio has done very well this year, which is reflected in our third-quarter asset quality results. In fact, in our 24 years as a public company, we have beaten the industry’s net charge-off ratio every single year, averaging about two-thirds better than the industry’s loss ratio.

Which closed deal, post-COVID, are you most proud of and why?

To pick one deal is difficult to do. We have the opportunity to work with some of the most sophisticated and financially sound developers on properties which spur economic development and enhance the quality of life for people who live, work, play, and visit in major metropolitan markets across the U.S. It’s not always easy, but it’s always rewarding to see a project successfully executed. We are proud of each and every deal we have closed in this challenging environment.

Any interesting anecdotes about a remote closing experience?

No. All have gone really smoothly.

What strengths do traditional lenders and non-traditional lenders bring to the market today? Who’s emerging stronger post-COVID?

Honestly, that’s kind of hard to answer just yet, as many lenders (both traditional and non-traditional) have been out of the market for some time. While there seem to be more getting back into the market, it’s really hard to speak for anyone else other than OZK.

How has your underwriting changed post-COVID? Is there more of an emphasis on underwriting or asset management today?

We’ve always placed great importance on both underwriting and asset management. While our underwriting principles aren’t changing fundamentally, we have to factor in the impact of the pandemic and where we think certain markets will be post-COVID. As far as asset management, the team has done an outstanding job handling borrower needs in very difficult times in order for the bank, the sponsors and project to all be successful.

Biggest overlooked market opportunity today?

We are looking for great opportunities every day.

“When I’m not doing deals while working from home, you’ll find me…” (please complete this sentence.)

“…watching many of the different news channels or trying to lose my COVID 10.”


Lighting Round:

Favorite TV show you binged during quarantine?

I don’t have one.

Have you eaten inside a restaurant post-COVID, and if so, which one?

Yes, and there are a couple.

Where is your COVID hideaway?

Long Island

Number of haircuts in past six months family trim or professional?

Several, professional.

Home office or actual office?

Mostly, home office.

Have you been on a plane post-COVID?


Best book you read during COVID?

“The Room Where It Happened” by John Bolton.

Which will rebound first: retail or hospitality?

Tough call … too early to tell.

Favorite post-COVID secondary market from a lending perspective?

We have made many loans in the primary markets of D.C, Boston and Philadelphia.

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