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the lunch

Stephen Fay, head of Aboriginal Banking at BMORachel Idzerda/The Globe and Mail

When Stephen Fay isn't in his office on the 17th floor of a Bank of Montreal tower in Toronto, chances are he's at a business meeting far away from Bay Street's skyscrapers.

"Let me tell you a story," the 57-year-old banker says with a gentle tap on my arm, one of many over our lunch at Reds Wine Tavern, near the heart of Bay Street.

After a meeting in Labrador, he went fishing on a river near Voisey's Bay with a colleague, an Inuit guide and the guide's young son. While the bankers had top-of-the-line equipment, the local kid was using a busted rod and rusted red devil lure – a humble red-and-white spoon – with great success.

"I just happened to have a rusted red devil in my tackle box, and I started emulating the little guy," Mr. Fay says. "And we cleaned up. I'm talking three-, four-pound specks."

That would be speckled trout, a freshwater beauty that's prized among anglers.

His story gets me thinking that I should really be expanding my angling interests beyond bass. But Mr. Fay is doing something far more important than scoring a shore lunch.

As the head of Bank of Montreal's aboriginal banking unit, his trips to some of the most remote communities in Canada are essential in building relationships with native people who are looking for loans to buy homes, expand businesses, build community centres, extend water supplies or add tourist resorts.

By his count, he has travelled to more than 300 communities in his 15 years at the helm of the unit. The communities are marked on an enormous map that dominates one wall in his office – from nearby Six Nations of the Grand River, about an hour's drive from Toronto, to Nain, an Inuit community located near the northern tip of Labrador that requires considerably more effort to access.

"You fly into Happy Valley-Goose Bay, and then you get on a little plane with a door that doesn't quite close and you fly for another hour and a half north of there," he says.

He hopes to extend his travels to the communities around the Ungava Peninsula this year, located 1,800 kilometres north of Montreal.

Yes, BMO has something to gain from these trips: Annual revenues from aboriginal banking have been rising at a double-digit clip for years, and accelerated close to 20 per cent last year.

That's a standout source of growth for a bank that, like its peers, is struggling to expand in a mature domestic market and slow economy.

However, Mr. Fay believes that aboriginal banking resonates well beyond BMO's top line. Indeed, he looks puzzled when I ask him if banking is good for these remote communities.

After a pause, he responds: "Yes, why wouldn't it be?"

Access to bank loans gives communities the means to build homes and develop complex infrastructure projects, raising financial stability and supporting aboriginal culture, he believes.

Canadian banks have been offering their services to aboriginal communities for years, and full-service branches began to pop up on reserves in the early 1990s.

But aboriginal banking has grown into a multibillion-dollar business that is becoming far more encompassing.

Lenders have figured out how to offer mortgages when the communally-owned lands of First Nations people impose limits on what can be used as collateral.

As well, recent land claim agreements with Ottawa and provincial governments have given many bands far more financial resources, delivering cash flows that can be used to fund relatively large and complex projects.

The Cote First Nation in Saskatchewan concluded a land claim settlement valued at $130-million. Various Algonquin communities in Ontario recently agreed to a $300-million settlement.

"Aboriginal banking is not the largest business segment in the bank," Mr. Fay says. It has just 10 people – many of them aboriginal – working directly within the unit, with about 200 more feeding into it. "But it is one of those segments where investment is paying off."

Mr. Fay began working for BMO after graduating with an economics degree from Wilfrid Laurier University. He trained in Collingwood, Ont., became a retail branch manager, then shifted to commercial lending in Brantford, Ont.

There, he worked with Ron Jamieson, a Mohawk (and now an Order of Canada member) who eventually became BMO's first head of aboriginal banking. He hired Mr. Fay, with just one aboriginal banking file under his belt, as his replacement in 2000.

"I needed somebody who had a good depth of experience in banking and had a solid relationship with the bank's credit department," Mr. Jamieson told me.

"In addition to that, Stephen is a very likeable guy and he has a personality that I knew would fit in with some of the aboriginal folks."

It didn't hurt that he's comfortable in the outdoors, either. He regularly makes the five-hour journey to his cottage near Espanola, Ont., where he fishes for walleye and hunts grouse.

But he is not aboriginal and there was little in his professional background that prepared him for aboriginal banking.

"You have to develop relationships, and that is basically what I was hired to do," he says.

"They're clients and I'm a banker, but the relationships have developed to the point where we know each other quite well. And you're meeting some of the nicest people you're ever going to find."

Donald Maracle, chief of the Mohawks of the Bay of Quinte, told me that his community, located west of Kingston, Ont., has turned to BMO for financing homes, an administration building and a water treatment plant, and that Mr. Fay has always gone out of his way to help.

"We would consider him one of our friends," he says. "We have never disappointed him and he has never disappointed us."

J.P. Gladu, president and chief executive officer of the Canadian Council for Aboriginal Business (where Mr. Fay is a board member), added that Mr. Fay has the right qualities for this area of banking.

"You have to be a humble guy, but you have to know your stuff – and I think Stephen is both," he says. "He's a listener as well. And when you have those key attributes, you can do some wonderful things."

At lunch, Mr. Fay is wearing a suit and tie that makes him look like a typical silver-haired banker (he wears a suit when he travels north, but usually ditches the tie).

However, it's easy to see the qualities Mr. Jamieson and Mr. Gladu are talking about. Mr. Fay is a warm, affable man with the big hands of someone who is more comfortable with chainsaws and snowmobiles than chilled Chablis. He also has the endearing quality of answering questions with anecdotes.

When asked about whether northern communities can feel alienated by city bankers, he responds: "I want to share a story with you," and puts aside his lobster grilled cheese sandwich for a moment.

Soon after getting his job at the head of the unit at BMO, he embarked upon his first trip to a remote First Nations community in Northern Ontario. He was invited to a council meeting, where he watched the way people interacted with each other – noting that their respect for the person talking and their embrace of silent gaps in the discussion was completely at odds with his experience in Toronto's more rowdy corporate boardrooms.

"Some people want to fill those gaps, but in First Nations culture, that's not the case," he says. "They want that time to think. And I quickly saw that." Two minutes of silence is nothing, he adds.

He knows the lives of aboriginals can be challenging in Canada, but points out that bad news tends to get far more attention than upbeat developments, such as the opening of a new community centre, school or business.

"I have very strong feelings in that area," he says.

He's optimistic that things are moving in the right direction: Education levels are rising and greater financial stability is encouraging the younger generation to stay closer to home, preserving their languages and culture.

"Chief Louie of the Osoyoos told me that the secret to protecting [aboriginal] culture is money," Mr. Fay says, referring to the celebrated chief who has transformed a once-struggling band in British Columbia to a thriving base for a vineyard, winery and golf course – and millions of dollars in annual revenue.

Banking, in other words, is serving a social purpose that adds another dimension to his career.

"In the past 20 years, I've seen such an improvement," he says. "I wish I could live another 50 years to see the progress ahead."


Stephen Fay, head of Aboriginal Banking at BMO

Age: 57

Place of birth: Kitchener, Ont.

Education: Economics degree from Wilfrid Laurier University.

Family: His wife is retired from BMO; his son and daughter currently work at BMO, in online banking and financial services, respectively. "They saw that I loved my work and that my blood pumped BMO Blue. They took note," he says. "They are each following their own path within the organization. I could not be happier or more proud of them."

Favourite vacation spot: Agnew Lake, Ont. He owns a cottage there.

Preferred mode of transportation: Cars and planes are a necessity. He prefers his boat, a 17-foot Legend with a 90-horsepower engine.

Favourite movie: The Shawshank Redemption.

Hobbies: He's an amateur astronomer.

Favourite sport or activities: Fishing and boating.

Favourite fish: Walleye, also known as pickerel. "I eat the fish I catch and enjoy a nice fish fry with friends, (just coated with flour and seasoning and fried)."

Hero: Gene Roddenberry, the creator of Star Trek. "I am a bit a of a Trekkie. The stories endure because they portray mankind moving forward as one people and shedding our petty differences. I find this very compelling."

Guilty pleasure: Ice cream.

Best part of his job: "When we close a deal that will have a direct and positive impact on lives. For example, when I hear stories after, say, a large number of houses are built that relate to children finally having their own bedrooms, this seemingly small thing is not small at all. It's huge in that family life is being improved. You just know in your heart that life will be better."

On the report from the Truth and Reconciliation Commission: "It's still early days. My hope is that it will provide another opportunity for all Canadians to learn more about Canada's First Peoples."