Cost-cutting; Making market-share lemonade from lemon headlines (May 2009)

Editorial content organized by topic

Sponsored content from industry partners

PRODUCT/CONTRACT ANNOUNCEMENTS
Latest offerings by category

JOB BOARD

Articles submitted by industry partners

DIGITAL EDITION ARCHIVE

Online Edition

Cost-cutting; Making market-share lemonade from lemon headlines (May 2009)

Headache 1
What are you doing to cut costs?

Remedy 1
Billie Wade, president and CEO, Citizens Union Bank, $819 million-assets, Shelbyville, Ky.

We performed a really tough evaluation of our branches—both current performance and their opportunities for potential growth and profitability. As a result, we are closing two of our 20 locations this summer. We promised all employees that they would not lose their jobs as a result of the pending closures, and that they would instead be reassigned to other locations. We may be slightly overstaffed for a time until attrition levels out our employee ranks, but we think that morale will be much better by not eliminating anyone.

Remedy 2
Lynda Messick, president and CEO, Community Bank Delaware, $69 million-assets, Lewes, Del.

We’re revisiting and reviewing all vendor contracts and rebidding or re-negotiating. You would be surprised how many vendors are willing to negotiate, rather than lose the bank as a client in this environment.

Remedy 3
Blair Hillyer, chairman, president, and CEO, First National Bank, $165.6 million-assets, Dennison, Ohio.

We have reduced donations and sponsorships dramatically and we are trying to control our part-time hours. We are watching expenses carefully, plus worrying about the final FDIC assessment amount.

Remedy 4
Rheo Brouillard, president and CEO, Savings Institute Bank and Trust Co., $843.9 million-asset, Willimantic, Conn.

We have simply been holding the line on new spending and have not filled vacancies as they have come up at the bank.

Headache 2
Making market-share lemonade

Experts have been pointing out that the current period represents a good opportunity for relatively healthy smaller banks to pick up market share. Has your bank had some of this success?

Remedy 1
Charles Cavanagh, president, United Community Bank, $187.2 million-assets, Perham, Minn.

We have attracted considerable new deposits with an advertising campaign touting our safety and the fact that we are a Main Street bank, not a Wall Street bank, and did not contribute to the housing debacle. Here’s the text of one radio spot:

“You have probably heard too much about the mortgage problems created by irresponsible lenders across the country.

“Well, United Community Bank in Perham wants me to tell you they do not have mortgage problems.

“None. Zero. Zip.

“OK, maybe one problem. They want more people to help buy, build, or improve a home.

“Go to United Community Bank. Solve their problem. Ask for a great loan. They are eager to please.”

Remedy 2
Lynda Messick, president and CEO, Community Bank Delaware, Lewes, Del.

We have seen activity in both deposit growth and growth in loan request volume. We have capitalized on that in both areas through community outreach. Our lenders have reached out into the community to remind businesses that when the bigger banks are trimming loan portfolios to shrink their balance sheets, that we are still here to serve the local community.

Got remedies? Join the ranks of our volunteer prescribers by e-mailing to This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

The electronic version of this article available at: http://www.nxtbook.com/nxtbooks/sb/ababj0509/index.php?startid=16