Sturdy Savings Bank has elevated its commitment to its wealth advisory business to a level that would make most rivals envious: It has made the investment services program part of the bank's philosophy.

The philosophy, embodied in an acronym the bank president coined "CLARI," includes the investment program as part of the bank's "five-star focus." The other letters stand for community, lending, account acquisition and retention.

"We're not just another department or division. We're well integrated into the culture here," says David Repici, the manager of the wealth advisory program and the business development officer of the Cape May, N.J.-based community bank.

The program, which launched in January 2007, had $90.4 million in assets under management at the end of last year. And it generated $598,000 in revenue for the year, up 23% from 2011.

The numbers may seem like small potatoes to big banks, but when compared with programs at banks its size, they're nothing to scoff at. Of the 306 banks with assets between $500 million and $1 billion that report income from investment programs, Sturdy ranks 83 in income generated, according to statistics from research firm Michael White Associates.

Its profitability is even more impressive. Sturdy's program contributed 16.5% to the bank's non-interest income in the first three quarters of 2012, nearly three times the average of 5.9% for banks its size. "That's strong for a little bank," says Michael White, president of the eponymous firm.

But the most impressive thing about Sturdy's program so far is its growth rate. For the three-year period ended Sept. 30, 2012, the program grew at 38.6% annually, far outpacing the average of 1.6% at peer banks.

"They look pretty good for a youthful bank program," says White, adding that it still has "growing to do."

To enhance the program's growth prospects, Repici made sure management understood that the program would need support through good times and bad. He explained that the advisory business was vulnerable to market downturns and it was during those rough patches that the bank's support was needed most. "We're going to come against tough times in the market," he told bank management.

Sure enough, it soon did. The market meltdown of 2008 tested the bank's commitment, a test it passed with flying colors. "Not once did they waver," Repici notes, adding that many banks tend to want to pull back when "things get dicey."

"At a time when other companies may have been scaling back, we were adding staff and increasing AUM and revenue," Repici says. The bank president was willing to commit the resources to position the program for growth knowing that it would be an immediate expense at the time.

Repici says constant communication is one reason the program works. Consequently he meets with the bank president every Monday morning to discuss the program's progress.

Repici joined the bank in February 2006 from UBS, where he was a financial advisor, to head up new business development. Having worked at the senior level in banking for more than two decades, as well as eight years at two of the world's largest brokerage firms as an advisor, Repici knew what worked in the wealth advisory space.

At Sturdy, he sought to marry the best that banks and wirehouses have to offer. "We feel we don't act like a traditional bank program. We're kind of a blend," Repici said.

Bank programs, he notes, tend to be narrow, focusing primarily on products rather than wealth management. And wirehouses, while providing a full range of products and services, are too large and impersonal.

Repici aimed to build a program with the technology and breadth of services available at the wirehouses without losing the personal, hometown feel of a community bank.

To that end, he made it a point to hire local advisors who lived in the community and were aligned with the customer-focused culture of the bank. "In the financial services business, our reputation in a small community could be wiped out in a heartbeat if the advisor was not aligned with the wants and needs of the client," he observes.

Being local even trumped having a book of business in Repici's hiring decisions. The three advisors he hired either lacked books of business or were unable to bring over their accounts due to non-compete agreements with former employers. "Instead of bringing a book of business, we really identified key individuals we felt would help grow our business and be aligned with the culture of our bank," he said.

Even the two sales assistants were local residents. With a five-member community-based team, the program fulfilled the "mom-and-pop" dynamic Repici was looking for.

For technology, communication platforms and back-office support, Repici turned to third-party marketing firm Cetera Financial Institutions, which competed with a handful of other contenders.

"What we want our clients to know is that we do virtually everything right here in their hometown that the larger financial services firms can do," explains Repici.

The program made adjustments along the way. In 2008, the bank re-invented the program, one year after its launch, by shifting its focus to advisory and recurring fee business. The shift positioned the program for growth, even though initially the increased fee business caused a drop in revenue, Repici says.

Advisory and recurring fee business accounted for 37% of the program's revenue in 2012, but that figure is rapidly growing. The most recent revenue numbers for the past four to six months puts the figure closer to 45% to 50%, according to Repici.

Repici aims to hit $100 million in AUM in the next couple of months and is shooting to generate $655,000 in revenue this year. He expects to reach the $1 million mark in production in the next few years.

His biggest goal, though, is gaining the No. 1 market position among bank programs in Cape May County, the bank's home base. "I would like Sturdy to be viewed as the premier wealth management group within the county." It's already the leader for deposits, he says, and the next step is "for our financial services group to have that distinction."

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