This document discusses diversity in the Rhode Island banking industry. It finds that 84% of bankers in Rhode Island are non-Hispanic white, with Hispanics being the next largest group at 7.4%. There is a lack of diversity in senior and executive-level positions, with minorities comprising only 2% of senior roles and 0% of C-suite positions. As the population of Rhode Island grows more diverse, representatives from the banking industry believe their workforces will naturally diversify over time to better represent their customer bases. However, others argue more proactive efforts are needed to improve diversity at the highest levels.

1. 14 | SEPT. 14-20, 2015 | PROVIDENCE BUSINESS NEWS | www.pbn.com
READYFORCHANGE?
been putting a greater focus on provid-
ing a more “inclusive environment,”
said Yvette Vargas, head of develop-
ment at Citizens. Vargas’ department
tracks data and while she couldn’t
immediately provide specific figures,
she said there’s a “healthy population
of women at the top.
“We want to use the full capacity of
our talent,” Vargas said. Citizens CEO
Bruce Van Saun took over leadership
of the Providence-based bank when
former Chairman and CEO of RBS
Citizens Financial Group Inc. Ellen
Alemany retired in 2013. She was
ranked No. 4 on American Banker’s
list of the 25 most powerful women in
banking in 2012.
Botelho thinks the state’s financial
institutions will naturally become
more diverse, “because you have to
play to your customer base. If you look
at Rhode Island, there’s a growing
population of Hispanics and Asians, so
there’s likely going to be more diver-
sity.”
DIVERSITY LACKING
Non-Hispanic, white bankers make
up 84 percent of the Rhode Island bank-
ing industry. The next largest racial
group is Hispanic bankers at 7.4 per-
cent, followed by non-Hispanic black
bankers, 4.7 percent, and non-Hispanic
Asian bankers at 2.7 percent, accord-
ing to the DLT.
These numbers largely reflect
nationwide trends, as Non-Hispanic,
white financiers comprised roughly
84.9 percent of the U.S. financial indus-
try in 2011, according to a 2013 study
conducted by the U.S. Government
Accountability Office, an investigative
arm of the U.S. Comptroller General.
To compare, Non-Hispanic, white
workers in 2013 comprised 83.1 percent
of the Rhode Island labor force and 79
percent of the U.S. labor force, accord-
ing to the U.S. Bureau of Labor Statis-
tics and U.S. Census Bureau.
But there’s little diversity in the
banking industry’s top positions and
Rhode Island numbers are even worse.
The General Accounting Office
estimated racial minorities comprised
10 percent of all banking executive
and senior level officers and managers
nationwide in 2008, the most recent
data available.
In Rhode Island, 2 percent of senior
positions in the industry are held by
racial and ethnic minorities, which
drops to zero percent at C-suite roles.
There are currently no female minori-
ties represented in senior or C-suite
positions.
Throughout the country, upward
mobility has proven difficult for racial
minorities in the financial sector. The
GAO reports that from 1993 to 2011 the
overall racial minority employment
at the management level increased
7.9 percent. Black representation rose
0.7 percent and Hispanic employment
increased 2.4 percent over that time pe-
riod. Asian employment rose the most
at 4 percent, according to the study.
Eckel notes that the majority of
Washington Trust’s footprint in
Rhode Island to date has been in South
County, where the general population
is less racially diverse compared with
Providence County. She says diversity
is also often lacking in applicant pools.
Rhode Island, in general, is less
diverse compared with the national
average.
In 2013, 75.3 percent of Rhode Is-
land’s population was white compared
with 62.6 percent nationally, according
to the U.S. Census Bureau.
But as Washington Trust, which
expects to have 22 branches by the end
of the year, continues its growth plan,
Eckel believes more diversity in the
workplace could follow.
“As we expand our physical pres-
ence, it’s opening more opportunities
for us to expand the diversity within
our pool of workers,” Eckel said.
Both Botelho and Wheeler agree the
long-term forecast for the Rhode Island
workforce, including banking, is that
it’s going to become more diverse. The
Census Bureau forecasts that non-His-
panic white people will comprise less
than 50 percent of the U.S. population
by 2043.
“It’s a natural inevitability, but I
don’t think that should be an excuse as
to why things aren’t happening now,”
Wheeler said.
Vargas, of Citizens, is Latina and
says Citizens, like many financial
institutions, has “some work to do”
when it comes to the inclusion of racial
minorities. But as a part of the new
talent-building strategy, she says the
bank is taking a two-fold approach.
“Bringing in diverse talent to the
mid- to senior-levels and expanding
your professional network will help
safeguard and accelerate the process,”
she said.
Jim Vincent, president of the
NAACP in Providence, agrees with
Wheeler, saying the numbers found in
banking are reflective of other indus-
tries. But he sees no excuse for lack of
leadership in top positions.
“It’s a drummed-up excuse saying
more diversity will come,” Vincent
said. “We’ve had robust diversity in
our colleges and universities for about
45 years now and to say you can’t find
people for senior and C-suite positions
is disingenuous,” he said.
WHO WILL LEAD?
Merrill Sherman, Rhode Island’s
first-ever woman CEO in banking, took
over at Woonsocket-based Eastland
Bank, a failing thrift in the 1990s. She
came in as general counsel before she
was asked to lead it prior to being sold
to Fleet Financial Group.
When asked about how it felt to be
the state’s first woman CEO in bank-
ing, she quipped back: “If it was a great
job, they wouldn’t have given it to a
woman.”
But the FDIC valued Sherman’s
performance and subsequently asked
her to run a different failing bank in
Vermont. She returned to Rhode Island
when Fleet acquired Shawmut Bank
in 1995 and had to divest branches.
Sherman and others raised capital,
bought the branches and created Bank
Rhode Island in 1996, which she headed
as president and CEO before it was
acquired by Brookline Bancorp Inc.
Sherman, now working as a con-
sultant, says one issue the banking
industry has right now is that it’s not
attracting a “dynamic workforce,”
properly equipped for today’s environ-
ment.
“I think it’s a cultural thing within
the [industry],” Sherman said.
This idea is paired with the fact that
women are steadily becoming a small-
er percentage of the overall banking
workforce. From 1996 to 2013, women
in banking dropped from 77 percent of
SOURCES: R.I. DEPARTMENT OF LABOR AND TRAINING LABOR MARKET INFORMATION DIVISION,
U.S. CENSUS BUREAU AND PROVIDENCE BUSINESS NEWS RESEARCH.
‘As we expand our physical presence, it’s
opening more opportunities for …
[workforce] diversity.’
ELIZABETH B. ECKEL, Washington Trust Co. senior vice president