One of Krista Brink’s favorite movies growing up was It’s a Wonderful Life, the story of small-town banker George Bailey, who learns after a failed suicide attempt how his life has touched so many others.
Jeff Bank, a small community bank in upstate New York, is a lot like George Bailey, says Brink, manager of the WalMart branch in Monticello.
“Jeff Bank does so much for our community. If it wasn’t here, it would leave an awful hole in Sullivan County,” Brink said.
Brink speaks from experience. Her 8-year-old son has autism, and when she asked her employer to sponsor a team for the autism walk, Jeff Bank stepped up. The commitment was just one of many walks, fundraisers, charities and community events the bank supports.
Once a thriving resort region, Sullivan County has fallen on hard times. Today, it is one of New York state’s poorest, oldest and least healthiest counties, with high unemployment and an aging population. Jeff Bank, headquartered in Jeffersonville, which celebrated its centennial in 2013, is the last surviving community bank in the county. Once home to 11 independent community banks, Sullivan County is now mostly banked by large, multi-state corporations.
“It gives us a leg up,” Said Wayne Zanetti, president and CEO. “We’re able to do everything locally.”
Thriving in Hard Times
Despite the recession and tough local economy, Zanetti says Jeff Bank, with total assets of $435 million and 12 branches, is doing “fantastic.”
For the third quarter 2013, the most recent quarter available for this article, Jeff Bank Reported net income of $1.383 million, compared to $1.105 million for the same quarter in 2012. For the nine months ended Sept. 30, 2013, the bank earned net income of $3.563 million, compared to $3.285 million for the same period in 2012. The increase in net income for both periods was primarily due to a decrease in the provision for loan losses, interest expense and foreclosed real estate expense.
Since the recession began, Zanetti said the bank has put aside more than $2 million to cover loan losses. In all, he said about 3.5 percent of the bank’s total loan portfolio of $270 million are nonperformers.
“We’re still able to maintain a rate of return on assets (ROA) of over 1 percent, which is very high in New York state,” Zanetti said. “In return on equity and ROA, we’re in the top 15 or 20 in the state.”
Jeff Bank offers a full range of retail and business products, including residential mortgages and small business loans.
In 2012, Jeff Bank de-listed its common stock from Nasdaq, and converted from a national to state charter.
“Plain and simple, we de-listed from Nasdaq to save money,” Zanetti said. “Because of SEC regulations, there are a lot more reporting, exam requirements. De-listing saves us quite a bit of money.”
Likewise, he said converting to a state charter made economic and regulatory sense for the bank.
“We’re a small community bank. It’s tough to take regulatory direction from Washington. The state knows the situation we are going through. We connect a lot better to local regulation versus national regulation.”
Going forward, Zanetti said managing a bank in the current low interest rate environment is challenging, but is optimistic about the prospects of a casino locating in the area.
“With the extra business a casino will bring, it expands the number of small retail stores and businesses. It should put a lot of people back to work.”
As a small local bank, Jeff prides itself on knowing and connecting to its customers and community.
“I like to brag that people can call me directly,” Zanetti said. “It’s the same way with decisions, loan decisions, how we treat our customers. We know our customers and what’s going on in their communities.”
Just as Zanetti is accessible to bank customers, he and other bank employees are accessible to the broader community, serving on nonprofit boards, supporting local charities, coaching Little League, Soccer teams, volunteering for Habitat for Humanity, supporting local walks, collecting Toys for Tots – the list goes on and on. Each quarter, Jeff Bank’s 120 employees choose a local charity, and donate money, matched by the bank, to that group. Last year, bank employees donated between $1,200 and $1,500 to the American Cancer society, local animal shelter, the local Boys and Girls Club, and local hospice. Employees also earn points for volunteering that can be put toward a day off, a massage, clothing or other rewards.
“It makes me very proud to work here,” said Brink, who, with the support of the bank, has raised more than $15,000 for Autism Speaks.
“We do it because we can do it,” Zanetti says simply. “We’re showing support, loyalty to our employees and also our customers. If our employees, customers and neighbors do well, we do well. It’s a two-way street.”■