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Old world grace; new world vision.

Integrity, vision, grace under pressure--these are all words associated with Stephen Ashley--chairman and CEO of The Sibley Group. This month he brings those traits to the job of leading the mortgage banking industry in a time of serious new social challenges.

WHILE RIDING HIS HORSE AROUND A WOODED, grassy farm inherited from his grandfather, Stephen B. Ashley is simultaneously at home and in heaven. If he weren't a mortgage banker, he says, he suspects he'd ride his horse even more than he does now--which is four or five times a week, including riding after the hounds on weekends during fox-hunting season, August to January. At least, he rode that often before a bad fall from his horse landed him in a hospital bed.

Ashley has deep roots in the Rochester region--his children, Jonathan, Leeson and Jillian, are the seventh generation of Ashleys to live on the farm--and a solid reputation in the community. He is a director of the Rochester Chamber of Commerce, the Genesee Corporation and Hahn Automotive Warehouse, Inc. He serves as trustee of the Rochester Museum & Science Center, the Genesee Hospital, Allendale-Columbia School and the Center for Governmental Research. He is a member of committees for Cornell University--where he obtained a bachelor of science degree in agricultural economics in 1962 and a master's in business in 1964--and for St. Paul's Church.

Ashley leaves that farm every weekday morning in his gray Jeep Wagoneer for a 40-minute drive to another of his passions--The Sibley Group companies, which he joined in 1968 and bought in 1982.

His length of service at Sibley is reminiscent of an old-fashioned era when employees spent their entire careers with one firm. Ashley isn't unusual in this regard, however. Most of Sibley's officers have been with the company more than 15 years, and many employees have been there 5 to 10 years. In this way, as in others, the man and the company seem to suit each other well.

He parks his car in a nearby parking garage, enters his building and takes an elevator to a neat, modest office on the seventh floor of the Crossroads Building, a 16-story, 1960s-vintage structure at the corner of Main and State streets that has housed The Sibley Group for 22 years. Downtown Rochester mixes modern glass towers fairly evenly with ornate turn-of-the-century brick buildings.

Like any executive office, it has a view. He can see the old-fashioned five-and-dime along Main Street next to the new fast-food restaurant. He can see new apartment buildings snuggled next to the Gilded Era mansions along East Avenue. He can even see out to the countryside his ancestors farmed. But sitting in his office, Ashley has more than a view. He has a vision.

'That Vision Thing'

Vision is a word that comes quickly to people's minds in describing Ashley's leadership strengths and one that he uses himself when characterizing his role as chairman and CEO of The Sibley Group, which is made up of the mortgage company, a real estate services company and an insurance company.

"I see my role as primarily being one that sets direction and hopefully as looking out 18 to 24 months," Ashley said, sitting at a small conference table in his office prior to his accident, in a navy two-piece suit and red tie. "I see the parameters of risk." Ashley compares himself to an athletic coach who generates team motivation, selects the players and makes sure the players are playing their positions well.

"You have to work against a plan, a vision of what your hopes are for an organization," he says. "I think that's true of any organization. You have to have in mind some concept, a plan of where you want to move this group, what you want to accomplish."

One of the many thoughts that run through Ashley's mind during his morning and evening drives each day are the individual strengths and weaknesses of his employees and what skills are required to move the group forward.

"I think a good leader continuously assesses good people and works to bring the best out |in them~ and works to strengthen them," he says. One does not just point people in a direction and let them go, he adds.

A business facing rapid change

This mortgage banker and gentleman farmer has an ethical, moral and business style that echoes an earlier age, but his outlook is focused steadily on the 21st century.

With the rate of change in the mortgage banking industry today creating ever-greater challenges of capital, technology and human resources, Ashley says, "you are constantly bringing your organization up against those challenges on a daily basis."

That rate of change is very much on Ashley's mind as he assumes the presidency this month of the Mortgage Bankers Association of America (MBA), a position he feels privileged to hold. "The rate of change in the mortgage banking industry is incredible," he says. "It's an accelerating rates, it's a geometric rate.

"MBA has got a unique opportunity, with its position now as representing the industry that produces more than half of the real estate financing in the country, to position the industry as a leader on the issues that affect real estate financing, both single family and commercial," Ashley says.

Providing the best mortgage product at the lowest possible cost to the homeowner must be the overriding priority for the industry, Ashley says. "The minute we begin to measure our industry performance in something other than its benefit to the homeowner, then we're on a kind of slippery slope."

Within that framework, the single most significant issue currently affecting the mortgage banking industry is that of fair lending, Ashley says.

"We as an industry need to understand why minorities are rejected at a much higher rate than white applicants. We need to look at ourselves as to what our policies are. We need to look at the secondary market as to what underwriting criteria we're held up to, and we need to better understand minority and urban employment patterns, credit patterns, savings patterns and then test those patterns against the underwriting criteria that we use," Ashley says.

To that end, Ashley has created a fair-lending committee at MBA that will focus on the issue of discrimination in lending through several new initiatives such as consumer homebuyer education. He has converted the diversity task force into a standing committee to examine minority employment and ownership opportunities in the mortgage banking business.

"We have a big challenge to better market to the minority community and to enlarge the pool of qualified buyers," he says.

Beyond the fair lending issue, the association will be tested on several fronts, Ashley predicts. These include mortgage bankers' ability to harness available technology and make it work to gain market share and the industry's response to continuous structural change, such as greater participation by mortgage brokers in the industry, he notes.

"The development of direct public ownership of the industry is a significant change that will require the association to address new constituencies," Ashley continues.

Plus, monitoring federal legislation and regulation will continue be a high priority for MBA, he says. "I quantify it as the challenge of steering the industry through the rock of consumerism and the hard spot of capital adequacy." The maintenance of the association's credibility is "paramount" to the industry's long-term good relations with the agencies, Congress and the administration, he says. "Our economics department has been superb in being able to present very credible data to support our positions on issues," he adds.

A sea change

And what Ashley terms a "sea change" within the industry is the shift in attitude by consumers toward their mortgages that has occurred during the past two years.

"The customer no longer views the mortgage as something that you do once and then that's it," he says. "We have educated them to refinance. We have brought products to them that make it very advantageous to refinance, and they're doing it with no upfront cash required," Ashley adds. "Homeowners now understand that the mortgage is a financial instrument that they can work and structure and tailor to meet their changing needs.

"I suggest that the future for mortgage bankers will be to stay in touch with that consumer," he says. "We now have the opportunity to work that customer relationship for the life of the loan and deal with their next loan, and I think there's a real challenge for us--a real opportunity there.

"Companies in the future will have direct marketing units that are cultivating these portfolios day in and day out. The technology is clearly part of it," Ashley predicts.

Ashley is viewed as the right person at the right time to lead the industry by fellow MBA officers Angelo Mozilo, president and CEO of Countrywide Funding Corporation in Pasadena, California, and Ron McCord, president of American Mortgage & Investment Company in Oklahoma City.

"We couldn't have picked a better leader particularly at a time when you have such a difficult environment, in some respects, politically for the lending community," says Mozilo, MBA president in 1992. "He'll bring intelligence and leadership. He has excellent interpersonal skills. I think he will be a very calming but forceful leader for the association. He seeks consensus and has the patience to achieve compromise even among the most contentious people in the association such as myself," Mozilo continues.

McCord served as vice chairman of MBA's legislative committee when Ashley was chairman in 1992. As chairman, Ashley achieved a balance between staying involved in issues and allowing vice chairmen latitude to operate within their subcommittees, McCord recalls.

"He's enthusiastic," McCord says. "He has a great grasp of the issues within our industry, particularly the legislative issues and their effect on our bottom line."

But Ashley is not all business, say McCord and Mozilo, who often joined him for dinner after MBA meetings.

"Steve is great at being able to cut off the day and relax and enjoy himself," McCord says. During those evenings, Ashley talks about the things that mean the most to him and his many interests: his wife, Jan, and their family, the New York political scene, opera and country western music and skiing in Vermont, where the family has a getaway cabin. "He's a fascinating man," Mozilo says.

When local political leaders contemplate running for office or need to touch base with their constituencies, they often contact Ashley. Representative Bill Paxon (R-NY), one of the two members of Congress representing the Rochester area, says Ashley is not only a constituent but a good friend and "someone whose advice I and many other political figures rely on.

"Steve combines an energy and enthusiasm level that is unprecedented, with a deep understanding of the industry and of Congress," Paxon says. "He is equally at ease testifying before a congressional committee as he is sitting around the kitchen table talking about these issues."

Paxon is one of several observers who note how well Ashley handles himself before congressional committees. He says he is thrilled to participate in the formulation of federal policy. '"I enjoy the challenge of addressing an issue, advocating a position and fielding questions that are not always friendly," Ashley says. "Your adrenalin does flow in that kind of an environment."

Ashley deflects all praise and eschews discussion about his personal life. The man who can talk for hours about his business or the mortgage banking industry in an expansive, vibrant manner becomes soft-spoken and reserved when asked about his world outside the company or MBA--unless the question is about horses.

While proud of their boss' allegiance to MBA, Sibley officers and employees wistfully remember a time when they did not have to make appointments to see Ashley or have to schedule meetings around the heavy travel schedule that accompanies the MBA presidency.

"I wonder if they'll feel that way when I return," jokes Ashley in a characteristic flash of dry humor.

The staff's fondness for their boss, however, does not stem from a casual, friendly relationship. The reserved "Mr. Ashley," as he is called by most people, is not one to pull up a chair in the cafeteria and share a few popular jokes with his employees or discuss recent plays by the Rochester Red Wings, the top farm team of the Baltimore Orioles baseball team. In fact, a recent innovation of holding "Town Meetings," where four or five Sibley employees meet informally with Ashley in his office to get to know each other and exchange views on the company's direction, is one of the few times many of the 120 employees at headquarters have said more than "hello" to their boss in the hall or at the company picnic.

Inspiring loyalty

But his honesty and dependability have inspired a remarkable loyalty, particularly among senior management.

"I think that is really coming from Steve's leadership," says Greg Samp, president and chief operating officer. "This is a place where people feel very comfortable and kind of find a home.... It is not a normal situation at all for anybody to leave here to go to the competition.

"There are opportunities for people here to grow and to grow as the company grows. Steve does well in giving people the autonomy to lead in their areas," Samp adds.

That does not mean Samp is not sought after. Like others in the firm, he has been approached by the competition, and like others, he believes there is no competition. Samp, who promised his wife they would be in Rochester no more than four years, just celebrated his 17-year anniversary with the firm, having advanced in that time from head of loan administration to president.

Samp was impressed early on by his boss. "It was not too long after I started that I did a review of the data processing because we really had an antiquated system," Samp remembers. At the time, Sibley Mortgage was owned by a regional bank holding company, Security New York State Corporation, and Ashley was president of the mortgage company.

"The bank holding company had a great interest in our using the software package that they already owned and were using for the bank portfolio. I selected another one," Samp explains.

But based on Samp's research and recommendation that Sibley Mortgage use a software package more appropriate for a mortgage company than a bank, Ashley told the holding company officers that the bank's software package would not work for Sibley, Samp continues.

"He basically told them that that was the wrong decision. We flat out weren't going to do it," Samp recalls. "He believed in what I told him and if they were planning on doing it another way, they shouldn't plan on doing it with him being involved. That all occurred after I was here an entire six months."

Ashley's commitment to doing the right thing and his faith and confidence in his employees engendered Samp's devotion then and still does.

"Integrity is without a doubt the basis on which this company has been founded," says David Fagan, senior vice president of commercial real estate finance, who came to Sibley 18 years ago from what was then the third-largest commercial lender. Like Samp, Fagan planned to be at Sibley a few years before moving on to a larger company, but also like Samp, he found himself drawn to the nurturing environment and growing corporation.

"Before you knew it, what I was after outside the company was happening here," he says, adding that he also appreciates the ethical nature of the firm. "We have not been pressured to generate business just to produce fees. People are proud to work here and really have a sense of dedication," he says.

With 25 years' service to Sibley Mortgage Corporation, Joan Markham predates Ashley by about four months. Having risen to executive vice president of finance and administration of the mortgage company and president of the real estate services company, Markham is particularly appreciative of Ashley's support in an industry where senior executive women are a rarity.

"Mr. Ashley is a person who is one or two or three steps ahead of where reality is," Markham says. "When everyone else wakes up to it, we're either halfway there, three-quarters of the way there, or decided that isn't the way to go."

In his vision for the company, Ashley has overseen a pattern of steady natural growth as the company's residential lending activities have expanded to the point where residential production and servicing dominate a firm created to originate and service commercial loans.

The company's residential and commercial servicing portfolio has grown from about $100 million 17 years ago to just less than $2 billion last year. The company originated $800 million in commercial and single-family loans in 1992, with $766 million of that in residential production. Commercial origination volume has increased slightly from about $30 million two decades ago to $50 million today.

"Since we are an independent company, we have to monitor our resources very carefully," Ashley says. Greater discipline is needed than for firms affiliated with larger institutions, and there is much less tolerance for mistakes, he says. "We have to do things smarter, faster and more profitably." Even so, other Sibley senior executives comment that Ashley is less conservative than they are about expanding the firm.

Ashley joined the company in 1968 from the National Life Insurance Company in Montpelier, Vermont, where he was assistant district supervisor for real estate investments.

Sibley's roots

Founded by Harper Sibley Jr. and E.B. Meader in 1955, Sibley Corporation originated commercial loans for Metropolitan Life and Massachusetts Mutual and acted as exclusive correspondent for John Hancock Life Insurance Company during the 1950s and 1960s. In 1970, Sibley Corporation became affiliated with the regional bank holding company, Sibley retired and Meader became president and CEO. A year later, Victor Hadeed joined the firm as a vice president, bringing with him residential production expertise and relationships with New York state savings banks.

Upon Meader's retirement as president in 1975, Ashley assumed the presidency of Sibley Corporation, and in 1982, he and Hadeed bought the firm from the bank holding company. When Hadeed, then executive vice president, retired in 1988, Ashley became sole owner.

The firm expanded into residential loan origination in the late 1970s, opening its first branch office in Buffalo in 1977. Residential offices were opened in Syracuse and Westchester County in 1978 and 1981, respectively. A fourth residential branch was opened in 1985 in Albany, and the first out-of-state branch was opened in Akron, Ohio, in 1988. Additional expansion is planned for Cincinnati and Fairfield County, Connecticut.

Sibley Real Estate Services, Inc. was founded in 1975 as a management subsidiary specializing in managing distressed real estate. The company now manages 7,000 multifamily rental and community association units and 600,000 square feet of commercial space and offers other services.

Sibley Insurance Agency, another sister company, was formed in 1989. Among the types of coverage offered are life, accident, disability and homeowners insurance.

"Many people would probably say that we've grown at an unaggressive pace, particularly when you look at the number of branch offices we have," Samp observes. "We're concentrating on being substantive players everywhere we have gone and put more of our energies in doing things like seeing our Buffalo office go from two to twenty people as opposed to opening a large number of offices."

When the firm does open new branches, it goes into markets similar to its current locations, Samp continues. "The way we operate our company, the style that we have, plays better in places like Rochester, Syracuse, Akron than maybe it would if we went into the more-glamorous, larger areas," Samp observes.

Sibley is known and respected in the communities it serves, Samp says. "We do what we say we're going to do. We're straightforward and honest about it," Samp says. "That's not to say that people who do business in those other places are not, but you have to have, I think, a lot more flash and pizzazz in some of those places than has been our style.

"I would classify every market that we're in as conservative," he adds. "Places in which unemployment has been low, people have not been faced with big depreciation in properties. There's been no bust, but there's also very little likelihood of a boom."

The black binders

Planning for The Sibley Group begins in August for the following year, and by January, each manager has a three-inch-thick black binder describing that year's tasks and goals. The binder serves as a guide throughout the year for managers and employees who together have created objectives for their departments.

"Rather than say, 'well, let's just say we'll do 20 percent more next year than this year' and pick some number out of a hat, we go into it with a real philosophy and thoughts that can help accomplish those goals," Samp explains. With the binder in place, he adds, "no one has any questions about what they're supposed to be doing.

"Through planning meetings and that kind of thing, Steve gets the entire management group involved in the company," Samp says.

"There is some excitement about being involved in the growth of a smaller company into a larger company," Samp says. "Steve is definitely a challenger. The first thing he'll say when you tell him it's going to take three months to do something is, 'Tell me why you can't do it in two months.' Then, depending on your explanation, you may get three months or you may get two months," Samp says.

Spotting potential

Ashley has a gift for seeing skills in people beyond what they see in themselves, says Gay Greene, senior vice president for marketing and communications. Greene started with the company 16 years ago as an executive assistant. "If you ever told me this is what I would be doing--I mean, I have a degree in speech pathology and audiology. I came into an entry-level position within the firm. He just saw my potential," Greene says. "He finds talent in us. He'll put us into things that we would never have come up with on our own."

Most Sibley Group employees know that it is relatively easy to bring a mistake or a problem to Ashley as long as they've discovered the glitch early on. The biggest mistake would be not telling him promptly, Markham says.

"He'll say--to the clerk that walks in the door |on~ up to Greg or myself--if there's something wrong, 'I need to know about it'," Markham explains.

"He can't deal with it unless he knows about it, and what we may think is a problem may not really be a problem because we don't know all of the circumstances," Markham says.

While Markham and others occasionally have heard Ashley's raised voice in these instances, he generally gets across his displeasure in more subtle ways. "You just know that wasn't the way to handle it," she says.

Late for the opera

Cortland Brovitz of Brovitz and Associates in Rochester, the long-time accountant for the firm and Ashley's close personal friend, tells a story about discovering an error at the same moment as Ashley.

A few years ago, the two men and their wives were at a restaurant in New York City before going to the opening night of the opera La Boheme. While being seated, they mentioned to the waiter their 8:00 p.m. curtain. The waiter in turn said he believed the opera started at 7:00 that evening, Brovitz recalls.

"Of course, I turned about 14 shades of purple. I never read the tickets. I had them in my pocket," Brovitz says. "Steve just gracefully got up from the table, called the limousine driver and asked him to pick us up at a quarter of 7:00. He never said a word."

Ashley's extracurricular interests will be curtailed over the next few months as he recovers from the riding accident. The spill he took from one of his field hunters, a Clydesdale named "Guinness," broke his leg but not his dignity or his intense focus on mortgage banking.

"This is an industry that has treated most of us very, very well," Ashley says, in articulating his reasons for becoming active in the trade association.

"We've been professionally challenged, we've been materially rewarded and we feel that we are doing something of value in our communities," he continues. "I think that there is a need for people who benefit and participate in the industry to provide some leadership and knowledge back to the industry."

Christy Wise is a freelance writer based in Washington, D.C.
COPYRIGHT 1993 Mortgage Bankers Association of America
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Profile; Sibley Group CEO Stephen Ashley
Author:Wise, Christy
Publication:Mortgage Banking
Date:Oct 1, 1993
Previous Article:More than a Midas touch.
Next Article:A powerful partnership.

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