ConnectOne Bank CEO Remains Bullish Amid Economic Risks

Summary

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Bloomberg Businessweek: "ConnectOne Bank CEO Remains Bullish Amid Economic Risks"

Date: November 24, 2025
Hosts: Carol Massar & Tim Stenovec
Featured Guest: Frank Sorrentino, Chairman & CEO, ConnectOne Bancorp

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Episode Overview

In this episode, Carol Massar and Tim Stenovec sit down with Frank Sorrentino, CEO of ConnectOne Bank, for a candid look at the current state and prospects of the U.S. economy, with a particular focus on small business, real estate, and New York’s unique market dynamics. Sorrentino shares why he remains bullish despite economic uncertainties, addresses political shifts in New York, and outlines what developers and banks need from policymakers in a challenging environment.

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Key Discussion Points & Insights

1. State of the Economy: Robust but Uncertain

• Sorrentino’s View:
  Despite widespread apprehension, Sorrentino remains optimistic about economic conditions, especially in the New York metro area.

  “We left the nice, calm part of the pool and now we're into the rapids... Yet, I believe we're on a robust footing here with our economy.” — Frank Sorrentino [02:36]

• Business Feedback:
  Most ConnectOne clients report strong current business performance, rising sales, and positive outlooks for the near future, despite generalized anxiety about what’s next.

  “Are your revenues up? Are you thinking about expansion? ...Our clients are telling us that business is continuing to improve, yet they have trepidation about where we’re heading.” — Frank Sorrentino [03:17]

• AI, Capital & Construction:
  Factors like AI integration, inflows of capital, and a construction boom are giving the region an edge.

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2. Divergences Across Markets and Sectors

• Sorrentino notes a “tale of two economies,” with certain sectors and demographics outpacing others. This disparity is important both for economic planning and for interpreting recent political shifts.

  “We do need to take a look at this — what's the distribution of where wealth is being created and not?” — Frank Sorrentino [04:35]

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3. Political Change & Its Impact on NYC

• Mayor-Elect Zoran Mamdani & Federal Funding:
  Concerns are raised about potential withdrawals of federal funds in response to the new, left-leaning city administration.

  “If we were to see in New York City or New York State funding cut off... would that have a big effect on the economy?” — Host [05:04]
  “It will have some effect... But New York has always been New York. Through all different types of political environments, it's been an uphill, nonstop economy.” — Frank Sorrentino [05:44]

• Long-term Optimism:
  Sorrentino trusts in New York’s resilience and suggests that political threats may not translate into serious economic harm.

  “At the end of the day, I think our president loves the city of New York. I can't see him doing anything that's genuinely going to be harmful to the city.” — Frank Sorrentino [06:58]

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4. Real Estate Lending & Regulatory Risk

• Rent-Regulated Property Exposure:
  ConnectOne does have exposure to rent-stabilized properties via its commercial real estate (CRE) portfolio.

  “For properties trying to convert from rent regulated... to market rent — those properties are going to have some challenges going forward.” — Frank Sorrentino [07:22]

• Policy Shifts & Impact:
  Sorrentino references existing laws and notes that while efforts to shift properties to market rates are likely stymied, the existing rent-stabilized stock is stable for now, thanks in part to potential property tax relief and insurance programs under the incoming administration.
• Rent Trends:
  Sorrentino highlights the importance of balancing rent policy with the realities of rising expenses, hinting at the complexity but expressing a preference for policies that maintain robust affordable housing.

  “I'd like to see us be able to do more in that regard here in New York City.” — Frank Sorrentino [08:51]

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5. The Supply Problem: Why Don’t We Build More Housing?

• New Rochelle as Case Study:
  Sorrentino points to New Rochelle’s approach, which prioritizes increasing housing supply to curb rent inflation.

  “The laws of supply and demand are sort of like gravity... So they built a lot of supply. Guess what happened to the rents? They came down.” — Frank Sorrentino [09:36]

• Barriers in New York City:
  Zoning, union requirements, and environmental regulations are cited as drivers of unaffordable construction costs, which, in turn, stymie development.

  “If you're going to force every small apartment builder to build using union labor, you're going to drive up the cost... And if they're unaffordable, they don't get built.” — Frank Sorrentino [10:25]

• What Developers Need:
  Significant regulatory adjustments and incentives from city hall are essential for boosting affordable housing stock.

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6. Looking Ahead: Federal Reserve & Rate Policy

• Upcoming Fed Meeting:
  Hosts push for insight on Sorrentino’s expectations regarding Federal policy at the upcoming December FOMC meeting.
• Rate Cut Hopes:
  He expresses hope for a further 25-basis-point rate cut, arguing that inflation risks are overstated and that tariffs distort the picture.

  “My hope would be that they continue on the path and they cut rates another 25 basis points in December.” — Frank Sorrentino [11:25]

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Notable Quotes & Memorable Moments

• On New York’s Economic Legacy:

  “If you chart the growth of New York from 1609... through to today, it has been an uphill, nonstop economy.” — Frank Sorrentino [05:51]

• On Housing Economics:

  “The laws of supply and demand are sort of like gravity... you can't undo them.” — Frank Sorrentino [09:36]

• On Regulatory Barriers:

  “They keep adding all of these things on and it makes the projects all unaffordable. And if they're unaffordable, they don't get built.” — Frank Sorrentino [10:58]

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Timestamps for Key Segments

• [02:36] Sorrentino’s take on turbulence and optimism in the economy
• [03:13] Evidence of business wellness in the New York market
• [05:04] Hosts bring up Mayor-Elect Mamdani and political risk
• [05:44] Sorrentino on New York’s resilience despite funding threats
• [07:22] CRE and rent stabilization: bank exposure and policy impact
• [09:36] Housing supply and policy lessons from New Rochelle
• [10:25] Regulatory obstacles to affordable housing supply in NYC
• [11:25] Sorrentino’s outlook on the Federal Reserve’s next move

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Conclusion

Frank Sorrentino’s insights offer a reassuring yet nuanced perspective on the regional economy, highlighting both the opportunities and the persistent hurdles for small businesses, real estate investors, and policymakers. Despite external shocks and ongoing apprehensions, his bullishness is rooted in economic realities and a deep belief in the resilience and adaptability of New York City and its business community.

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Transcript

[Host 1]

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[Frank Sorrentino]

Certain Bloomberg Audio Studios Podcasts Radio news.

[Host 2]

You'Re listening to Bloomberg Business Week with.

[Host 3]

Carol Massar and Tim Stanvak on Bloomberg Radio.

[Host 1]

One person we go to regularly for his view on the economy here in the United States and rates is Frank Sorrentino. He's chairman and CEO at the publicly held New Jersey based community bank ConnectOne Bancorp, which is the parent company of Connect One bank, accounts small businesses and construction companies among its customers. And the bank has some 63 locations maybe in counting in New Jersey, New York and Florida. And the bank earlier you will remember this, merged with first of Long Island Corporation. Now its total assets are about 14 billion. That's as of the end of September. Frank joining us here in our Bloomberg Interactive Broker studio. Did we get anything wrong?

[Narrator/Announcer]

Anything?

[Host 2]

All right, that's because I wrote it. And great and great to be back.

[Frank Sorrentino]

Great to see you.

[Host 1]

It's good to have you here. We love talking to you because we are at this moment where we're trying to figure out. I feel like I can say this a million times this year like where we are in the US economy. What's ahead? What kind of clarity do we have? Tell us about your business and what.

[Frank Sorrentino]

You'Re saying we left the nice, calm part of the pool and now we're into the rapids and the more turbulent it was. When you look back before Liberation Day. Okay, fair, certainly, you know, we're seeing a lot of people have a lot of apprehension about where we stand right now. Right. So small businesses have a lot of concerns. There's so many things going on. There's so many different data points to look at or not look at or not have information in front of them. But, you know, I, I know, I know we've talked about this before. I keep saying, I believe we're on a robust footing here with our economy.

[Host 1]

Because you see it in terms of what loan generation or what clients.

[Frank Sorrentino]

You know, they discuss the issues of, you know, not being sure what to do next. Yet when you ask them, how are sales, what's going on? You know, are you, are your, are your revenues up? Are you thinking about expansion? Are there opportunities? Are you looking to hire people? In our market anyway, in the New York metro market, which is the market we represent, we're finding that people, the businesses, business owners here are doing quite well and they're continuing to do well. And there's so many inputs that are helping, that AI is helping in a lot of cases, just the amount of capital coming into this region, the amount of construction going on, the amount of, of, of heavy and highway work, just you, you name it. Manufacturing. I think today there was a fact that came out about New York manufacturing is on the rise. Something that was actually a little bit of a surprise to most, not to me. Our, our, our clients are telling us that business is continuing to improve, yet they have trepidation about, you know, where, where, however, interestingly, if you ask them where they think they'll be in six months from now, everyone says they think they'll be in a better place. So everyone is counting on the economy getting better.

[Host 1]

Right.

[Host 4]

And.

[Frank Sorrentino]

Or at least their conception of what better may be from where they are today. What I say is they're in a good economy now and it's going to continue to do better. Now, there's also the tale of two different stories here. There are some parts of our economy that are not doing as well as others, and I think we saw some of the reaction to that relative recently in some of the political events that have occurred. So I think we do need to take a look at this. What's the distribution of where wealth is being created and not created?

[Host 3]

As a New Yorker, it's nice to hear that things in the New York city area are looking good. But it also makes me think of the changing politics of the city and Mayor Elect Zoran Mamdani. And you know, this is not a political question. It's simply a question about how people should plan for the future. We reported last week the Bloomberg news team that is that aides to President Trump have spent the days following Mamdani's victory in New York reviewing federal funds that benefit the city to potentially suspend or cancel, a White House official said, highlighting the threat of retribution over the Democratic socialist win. If we were to see in New York City or New York State funding cut off for some of these projects, would that have a big effect on the economy?

[Frank Sorrentino]

Look, I would believe the answer would be yes, it will have some effect.

[Host 3]

On the economy because you mentioned some infrastructure projects. Sure.

[Frank Sorrentino]

I don't seeing, I don't know how big that would be and I don't know what the, you know, it seems to me in this economy, at least over the last 12 months or so, there seem to be so many inputs that have been maybe going in one direction, maybe a negative way, and something else turns around and comes back in the other the other direction. So look, New York has always been New York and we've been through all different types of political environments and there have been ups and downs. But if you chart the growth of New York from 1609 or whenever, when the first settlement started here through to today, it has been an uphill, nonstop economy. And so I have every confidence that New York is going to continue to be the place to be. Are there challenges here today about affordability and who can live here and some of the changes that need to be made? Absolutely. I think we'll get those things right. What one thing I have learned from this administration, there are a lot of threats that are made and a lot of, you know, there's a lot of saber rattling. At the end of the day, though, I think our president loves the city of New York. I can't see him doing anything that's generally going to be harmful to the city.

[Host 1]

Frank, correct us if we're wrong, though. We were talking with some of our folks who also cover like the banking area. And our understanding is you do have some exposure to rent regulated. We do properties or apartments, I think via your CRE lending. So with the Mamdani win here in New York City, how do you feel about that exposure and what he has said about, you know, his pledge to freeze rents?

[Frank Sorrentino]

So look for those, you know, for those properties that we're trying to convert from rent regulated or rent stabilized rather to market rent. Those properties are going to have some challenges going forward because that's not going to happen. And part of that was the 2009, let's not forget the 2019 law made that change. And it was interesting, right. The candidate everybody wanted to win, which was Andrew Cuomo, he's the one who signed that law.

[Host 2]

So everybody's afraid of politics, the mayor coming in.

[Frank Sorrentino]

But yet, you know, it was the one who ran against him that brought that law to pass for the balance of the rent stabilized properties that are out there that are already cash flowing and have been underwritten under those terms. I think they're going to be fine. As a matter of fact, the current mayor elect has spoken many times about programs possibly to lower property taxes for some of those property owners and come up with insurance programs to sort of help out to keep the rents at a lower rate. So if that's true, and, you know, if there's going to be some level of negotiation around what to do or how to do it to keep the rent increases lower, I'm all for it. That's great. What we have found over the years is that there have been rent increases. There was just one passed recently for I think about 3% that went into effect in October. And let's not forget that the current mayor has six picks still on the rent guidelines board. And they're not, you know, they are supposed to look at the economy on the ground today. Where are expenses? You know, the city does raise your taxes and your sewer fees and the cost of everything else goes up. So rents should go up appropriately as well, based on inflation. So I do think there'll be a give and take there. And, you know, at the end of the day, look, I think having affordable apartments is a very, very great thing for our city. I'd like to see us be able to do more in that regard here in New York City.

[Host 1]

Why don't we do more? And I guess I asked that because.

[Frank Sorrentino]

We would need a very long program to get into what, you know, there are cities and towns. New Rochelle is an example of that, where they've taken the opposite approach, which is let's build as many apartments as we can possibly build. Let's let the developers go build.

[Host 1]

It stands out.

[Frank Sorrentino]

They did that. You know, the laws of supply and demand are sort of like gravity, right? They, they, you can't, you can't undo them. And so they built a lot of supply.

[Narrator/Announcer]

Yeah.

[Frank Sorrentino]

Guess what happened to the rents? They came down.

[Commercial Announcer 1]

Yeah.

[Frank Sorrentino]

They didn't go up, they went down.

[Host 3]

We had the mayor, Yadira Ramos Herbert, on a few months ago talking about this and the zoning changes. You have background as a builder. You actually went to college for this before you were a banker. And I think it's fair to say that all, I'm not going to say all economists, most economists would agree the way to decrease housing prices is to build more housing. How do you do that in New York City and our developers going to do that in New York? Like, what would developers need in the next administration in order to do that apart from zoning changes? Like, what would they need to hear from City hall that says you guys can go ahead and build and build more housing?

[Frank Sorrentino]

We would need zoning changes. We would need the ability to build housing that is affordable to build. You can't add on all of these issues. Yeah, listen, I'm, you know, I come from a union family, so I love, you know, unionized workforces, but if you're going to force every small apartment builder to build using union labor, you're going to drive up the cost. If we're going to force buildings to not be able to use certain types of natural gas appliances or they got to meet certain environmental.

[Host 3]

These are all issues that New York City has. Oh, absolutely. And builders have faced here.

[Frank Sorrentino]

And so they keep adding all of these things on and it makes the projects all unaffordable. And if they're unaffordable, they don't get built.

[Host 1]

I have like five more questions.

[Host 2]

No, we have, it's not that hard.

[Host 3]

We have 70 seconds.

[Host 1]

No, I know we don't have a long time. Just one last question because I've got it. We're Bloomberg. We do have a last Fed meeting come December. What are you expecting? What do you think we do need based on. You sound pretty upbeat. Just got about 40 seconds.

[Frank Sorrentino]

The Fed, the Fed's got a tough job ahead of them. On the one hand, you know, unemployment and the employment structure in the economy is giving some mixed signals. Yeah, you know, larger businesses may be hiring, smaller businesses may be laying off. That could be temporary in that camp. I do believe that the smaller businesses are going to catch up soon. I do think there is, I don't think there's a lot of inflation built into the economy. I think the tariffs are sort of skewing some of those numbers. I think they're going to have a tough call. My, my, my hope would be that they continue on the path and they cut rates another 25 basis points in December.

[Host 3]

Well, just another excuse for Frank to come and hang out with us again.

[Host 1]

And get to the questions.

[Host 3]

December 10th. That day, when we get that decision from Jay Powell in the Federal Reserve.

[Host 1]

You'Re just up the street, so come back soon.

[Producer Riley]

Will do.

[Host 1]

Frank Sorrentino, chairman and chief executive officer of Connect One bank, joining us right here in our Bloomberg Interactive Broker studio.

[Narrator/Announcer]

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[Host 2]

So usually on okay Storytime, our audience will send in their relationship problems. And the okay Storytime squad gives some good advice goofily. But today we're not giving out our usual advice. Our producer Riley says we're giving something else. So what are we doing today, Riley?

[Producer Riley]

Today we're playing a little game.

[Host 2]

Oh, I love game game.

[Host 4]

Says the man.

[Producer Riley]

I bought special gifts for you guys from ebay. Each one picked with one of you in mind. Yeah, Dakota, if you want to guess.

[Host 2]

All right. There is a gift at my feet. Open that.

[Producer Riley]

And now it is in my hands.

[Host 2]

Oh, I feel like it's got to be our resident gamer.

[Host 3]

Key.

[Producer Riley]

This is the rectangle of childhood.

[Host 4]

It's a portable game console. I used to have this as a kid. This game console. I used to play all the time. And you know when your mom came.

[Host 3]

Into the room when you were a.

[Host 4]

Kid and like you're pretending to sleep.

[Producer Riley]

Yeah, yeah, yeah.

[Host 4]

But Riley, what a thoughtful gift.

[Host 2]

Yeah, right.

[Producer Riley]

You're crushing it.

[Host 4]

But we have one more gift.

[Host 2]

Yeah, let's open it. Oh, camera. Yeah, an old timey camera.

[Frank Sorrentino]

That's right.

[Host 2]

Classic.

[Host 3]

This.

[Host 2]

This is awesome because you know how I love to take pictures of my travels.

[Producer Riley]

Yeah, you're always somewhere, whether it's in.

[Host 2]

Kyrgyzstan with some nomads or just New York, you know, with a nice little piece of trash or a rat taking.

[Host 4]

Pictures with the birds.

[Host 2]

So, Riley, you got all this from eBay, dude, eBay.

[Producer Riley]

It was really fun finding it with you guys. Like, I had very specific things for each one of you. It was all there.

[Host 2]

Thanks, Riley. And thank you.

[Producer Riley]

EBay. And guys shop ebay for millions of fines, each with a story. EBay. Things people love.

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