Banker

Stan Wilmoth is president of Heritage Bank of Nevada, which recently moved its headquarters to a new facility.

I hear from a lot of people that they are just weary of hard times, that Nevada’s jobless rate is always the highest … that Nevada will never have a vigorous economy again. What does that do to confidence, and is confidence that important?

Confidence is very, very important, because consumer spending drives the economy, and if we’re not spending money, then that’s an issue. The uncertainty that’s happening in Washington, D.C., in all areas, whether you’re a liberal or a conservative, it’s uncertainty. The polarization of the two parties in Washington is causing the consumer to be very uncertain. In Nevada, I think that the economy’s coming back to some degree. Unemployment’s a little bit lower than it was. We are starting to see some businesses migrate in from California. … Gaming is coming back some. It drove the economy in pre-recession days, but now we have other things that I think will help. Housing has recovered to some degree but there’s still a little concern that that shadow inventory [homes that could be foreclosed but haven’t been] is out there. [Bank of America], even though they’ve serviced the majority of the loans in Nevada, they still haven’t foreclosed on a lot of homes.

Is it all D.C.? Are there factors in your control at this level?

Yes, I think the majority of it is in Washington. I think the Consumer Compliance Group, Dodd-Frank regulation and those kind of things are just slowing lending, and a lot of consumers are frightened about what’s going to happen, but I think mostly businesses are just frustrated about what’s going to happen in Washington, D.C. There’s a section of Dodd-Frank on qualified mortgages that is 800 pages long. That in itself is going to create uncertainty.

Four years ago—that would be three years into the recession—you told us, “I can’t remember the last time I saw an application for a new business. The issue isn’t that we aren’t loaning money. Nobody’s borrowing money. … It’s more difficult to find a business model that you can project revenue today and make a profit.” How has that changed?

It has changed. Not considerably changed. We have a number of people right now out to expand their businesses and borrowing money. You’re seeing now where they’re building their equity back into their personal net worth and are starting to get cash flow back in, the top end starting to increase, total revenue. Three years, four years ago, it was all about expense cutting and that’s all you saw was expense cutting. There wasn’t much growth in the top revenue. But today you’re starting to see growth and revenue growth. And all that expense control that they did over the last three or four or five years is starting to pay off.

How do you describe your personal level of confidence?

I’m pretty confident that things will start to expand for us. … All we’re doing is providing loans to businesses and trying to get this engine working. We need to start driving jobs. Unemployment is for families that are really in need. It’s a great bridge. But you’ve got to get the bridge going to somewhere. And that bridge is a job. Most people don’t want to be on unemployment. They want a job. And we have to create a tax environment where people want to create jobs and not be so polarized.