Robert Senkler, retiring Securian CEO, guided with even hand
By Nick Woltman, Pioneer Press, St. Paul, Minn. | |
McClatchy-Tribune Information Services |
What followed was a near collapse of the financial industry that would change the economy forever.
That weekend Senkler was meeting with a group of his company's distribution partners in
"There's nothing you can do today," Senkler told them. "So, let's go golf."
Two years earlier,
Securian President
"It wasn't easy, but I don't think any of us had any doubt about how we were going to fare," Hilger said. "A big part of that was because of the leadership he provided."
When Senkler, 61, retires at the end of 2014, after 40 years with the company, Hilger will succeed him as CEO.
The company's balance sheet did suffer in 2008, but it recovered six months ahead of schedule. Senkler was calm that weekend because he and his company were ready.
"We cannot predict; we can only prepare," Senkler is fond of saying.
During his tenure as CEO, which will mark 20 years on Friday, Senkler has seen the 134-year-old company through some of its most challenging times.
But as he prepares to turn the corner office over to Hilger, Securian is in a strong financial position, Senkler says.
The company, which deals in insurance and retirement products, saw its earnings rise 9 percent in 2013 to
While he's well known as a business leader, Senkler also prides himself on his dedication to the
"He made a commitment to growing Securian in
'A BRASH YOUNG MAN'
His family has lived in the city for generations. His father spent his entire career at National Lumber, starting out as a janitor and retiring as president of the company. His grandfather worked at a local brewery.
After graduating high school, Senkler went to the
In 1974, he received his bachelor's degree and a job offer from Securian -- then called
Senkler began his career as an actuary, assessing risk in the company's individual insurance division. He reported to
"He was kind of a brash young man, not lacking in confidence," Hunstad remembered, adding that this confidence was well-founded.
Senkler welcomed responsibility and quickly climbed the corporate ladder. By 1987, he was vice president of the individual insurance division.
In 1994, Senkler succeeded
Senkler's management of the company has been heavily influenced by his experience as an actuary.
"I think he understood risk better than any previous CEO," Hunstad said.
Senkler knew that if clients thought Minnesota Life was reckless with its business, they had no reason to believe the company would be able to pay on their claims.
"We sell a promise to pay," Senkler said. "And if people don't trust your financial strength, or trust how you do business, they won't believe your promises."
BECOMING SECURIAN
It didn't take long for his risk-averse philosophy to manifest itself. Within his first few years as CEO, Senkler sold off two lines of business he viewed as liabilities: property casualty insurance in 1997 and disability income insurance in 2000.
Even as he was leading the company out of certain businesses, he was also looking for new businesses he could lead it into. His industry was in a period of consolidation, and Senkler was determined to put Minnesota Life in the position of buying rather than being bought.
But as he began eyeing possible acquisitions in the late 1990s, he ran into a problem. As a mutual company -- owned by its policyholders -- Minnesota Life had limited options when it came to financing deals.
"Our only currency is cash," Senkler lamented in a 1998 interview with the
He saw a solution in restructuring Minnesota Life as a mutual holding company, which would allow up to 49 percent of it to be owned by stockholders -- freeing up equity to increase its purchasing power.
While this arrangement was already popular in the industry, it wasn't allowed under
It was this expansion into retirement products that prompted its name change to Securian in the early 2000s.
"Minnesota Life implies just life insurance, and we're so much more than that now," a Securian spokeswoman told the
But Senkler was judicious in deciding which businesses to pursue. The company's competitors were getting into products like long-term care insurance and variable annuities.
"They were very popular, and they got a lot of companies into trouble," Senkler said. "Not following that herd mentality is kind of the hallmark of well-run companies."
ECONOMIC DISASTERS
Senkler's conservative approach served Securian well in the wake of the dot-com crash in the early 2000s.
Sales slowed and the company's investments suffered in the depressed economy. The company's profits fell to
Although profits bounced back a year later, it wasn't long before Senkler began seeing more economic trouble on the horizon.
Beginning in the mid-2000s, "we thought some foolishness might happen," Senkler said. "We put some economic scenarios together that were very dire and, I thought, would never happen."
"We were constantly modeling for adverse events," Prohofsky said. "I don't think we were very surprised by much."
When "AIG weekend" (Senkler's term) struck in 2008, Senkler knew what to expect. The company's risk-based capital would fall to
And they were awfully close. In the depths of the recession, Securian's risk-based capital sunk to a low of
Although the company eliminated 120 positions through attrition during the recession, it avoided layoffs.
"He likes to be in a situation where he's solving problems," Prohofsky said. "I think that's one of his real strengths: He stays very cool under fire."
LOOKING AHEAD
Senkler always has been clear with his employees that family supersedes work, but his philosophy took on an even more personal dimension in 2011, when his youngest son, Rick, died unexpectedly.
Senkler and his wife, Pam, were devastated, Hunstad said.
"Bob was still CEO, but I think if you had asked him in that first year after his son's death, his waking thoughts were about Pam," he said.
The Senklers' eldest son, Chris, soon moved back to
Eager to spend more time with his family, Senkler has been eyeing retirement for a few years. But he and Pam agreed that he would wait until Securian was in a stable financial position and a suitable successor could be found.
Although he will remain chairman of Securian's board, Senkler will hand the company off to Hilger on
Hilger is no stranger to the CEO role -- he had been chief executive of
"On day one I started reporting to Bob," Hilger said, adding that as his responsibilities within the company have increased over the years, so have his interactions with Senkler.
Hilger is aware that he's inheriting a business that will face new challenges in coming years.
Both Hilger and Senkler list cyber-security as one of their primary concerns. Recent high-profile attacks on retailers Target and
"It's a scary world," Senkler said. "We're working very hard every day to stay ahead of the crooks. Business has not really grasped how to stay ahead of the crooks today."
They've also got their eyes on changing demographics. As aging baby boomers begin to draw on their retirement savings and file life insurance claims, both men agree that they must be mindful of the impact on their business.
COMMUNITY COMMITMENT
Although each man has his own management style, Hilger plans to carry forward Senkler's commitment to
"This organization is really focused on being involved in the community," Hilger said. "And that starts with Bob."
Securian has grown its downtown workforce 47 percent during his 20 years as CEO, but that's not Senkler's only contribution to the city.
He was a visible advocate of the Green Line light rail and is credited with leading the effort to resolve a years-long dispute among the tenants of the
Senkler, who has been raising dogs since he was in second grade, also recently bought an English cocker puppy that he and Chris plan to train as a service dog for use in nursing homes.
"He loves
___
(c)2014 the Pioneer Press (St. Paul, Minn.)
Visit the Pioneer Press (St. Paul, Minn.) at www.twincities.com
Distributed by MCT Information Services
Wordcount: | 1762 |
Exclusive: Inside James Brown’s mansion + video and photo gallery
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News