Notes, news and views on community banking

Northwestern Financial Review, Apr 1-Apr 14, 2004

Highland Bank still a busy SBA lender

Highland Bank, St. Michael, Minn., is hoping to improve on its SBA rank in 2004, despite the recent cap reduction on 7(a) loans. To achieve that goal, the metropolitan area bank is capitalizing on Kim Storey's knowledge of the complete set of SBA-backed loans and credit lines. Storey, the bank's vice president of SBA lending, said by shunning personal credit scoring of the business owner and handling all SBA paperwork internally, she's been able to steer business customers to other SBA funding products.

Recently, two SBA loan applications that would have fit nicely into the 7(a) program prior to January's cap reduction were processed under the 504 loan program. "If your bank knows the SBA programs inside-out, then you can be sure to get the financing package that's best suited to your business," Storey said.

The bank also leaves the business owner's personal finances out of the equation. "We don't do credit scoring," Storey added. "We base our decision on the financials of the business, not the owner's personal credit."

The $360 million bank was ranked 10th in the state for number of SBA deals in 2003. "We are shooting to be in the top seven in 2004," said President Pat Bradley.

Nebraska bank helps town offer seniors assisted living option

Senior citizens in Newman Grove, Neb., now have an assisted living facility among their housing options, thanks to the First National Bank of Newman Grove. The $32 million bank put up $50,000 in matching funds to help build the $2 million, 18-unit facility. The community of 800 people won a $936,000 grant from the state's nursing home conversion program, and the remainder was raised through donations and loans. The Mid-Nebraska Lutheran Home of Newman Grove opened last year and 13 of the units are occupied. Residents get meals, plus services to help with laundry and cleaning.

Bank President Jeff Gerhart, who serves on the home's board of directors, said the facility allows seniors to remain in Newman Grove when previously they had to move out of town to find such a living arrangement. The units were constructed adjacent to the town's nursing home, which accommodates 41 people. The assisted living facility and nursing home constitute the community's largest employer with 84 people on staff and a payroll of $1.5 million annually.

Iowa bank encourages community to fill time capsule

American Trust and Savings Bank, Dubuque, Iowa, recently allowed residents of nearby Farley to donate items to a time capsule it planned to entomb during its grand opening celebration in that community. "We'd like to give our friends and neighbors the opportunity to bury something they feel will be fun or significant for people to discover decades from now," said Dan Willenbring, the $645 million bank's executive vice president. Some of the items citizens brought forward include: the 2003-2004 student handbook from Wayne Drexler elementary school, a menu from Bill's Tap restaurant, copies of USA Today, the Wall Street Journal and the Dyersville Commercial news, a Farley historical calendar, books from the Dubuque County library, a Farley Hawks baseball jersey, a 37-cent stamp and an ear of corn. Bank officials said they hope the time capsule will be opened 75 or 100 years from now.

Wisconsin banker promotes Junior Achievement

Cleveland State Bank, in Cleveland, Wis., has a dedicated teacher in staff person Cynthia Roech. With the $40 million bank's backing, the 20-year employee and Junior Achievement activist has been heavily involved in promoting the concepts of economics, business, free enterprise and entrepreneurship in community schools. "I've worked with a lot of the lower grades starting with a kindergarten program called 'Our Selves,' and worked up to where I recently presented a unit on 'Entrepreneurship' to a group of eighth graders," Roech said. "The older students were very surprised to learn that they could start a business of their own if that was something they'd want." Each session builds on the last, Roech said, with focus placed on family, community, and cities nicely fitting into the social studies curriculum at the elementary school. "Junior Achievement is just great," Roech added. "The bank has been backing this program and my involvement for three to four years."

Kids' bank up and running at Minnesota parochial school

Anchor Bank Farmington, Minn., recently launched a branch inside All Saints Catholic School in nearby Lakeville. The "kids' bank" was Anchor Bank Vice President Gary Moore's idea. "I saw a similar program at a bank in Wisconsin and thought, 'wow, what a great idea,'" Moore said. "The bank teaches kids about the benefits of saving and helps them develop good habits early."

Banking began in earnest at the K-6 elementary school in February with transactions being handled by the student employees in the upper grades. The school earns a donation of $10 for each new account opened at the All Saints branch with proceeds directed toward maintaining and updating library materials. The $87 million bank sends grown-up employees from its Lakeville branch to oversee operations at the kids' bank. The All Saints branch of Anchor Bank is open two days per month.