On the Road to Recovery: The New Jersey Banking Industry Responds to Katrina
By Timothy E. Doherty
As the devastation wrought by hurricanes Katrina, Rita and Wilma in the Southeast played out before our eyes on national television in recent months, the banks, companies, employees and customers of the New Jersey banking industry have reacted swiftly and generously.
Whether on-site in the disaster area with their own employees or providing donations to aid in recovery efforts, members of the New Jersey banking industry that responded to a New Jersey Banker survey, and their customers, were ready and eager to help.
AGILITY TO THE RESCUE
“When we woke up Saturday morning, the storm was doing a bull’s-eye right for New Orleans,” said Ward Stallings, chief administrative officer for New Orleans-based Eustis Insurance. “At that time, we went and secured our offices, and as we fled the city from the causeway – one of the bridges that lead out of the city – we called Agility to declare a disaster.”
North Carolina-based Agility Recovery Solutions, an NJBankers affiliate member, went to work immediately, establishing a temporary operating location in Baton Rouge for Eustis Insurance and, ultimately, assisting nearly 30 other Gulf area clients with their disaster recovery efforts. In the insurance company’s case, that included setting up temporary trailers in which Eustis employees could work and equipping them with desks, chairs and computers.
“Our efforts in Louisiana, Mississippi and Alabama have restored not only insurance agencies but also manufacturing facilities, construction companies, retail corporate offices, law firms and associations,” said Agility President and CEO Bob Boyd. “It will dwarf any recovery effort that has ever happened to the industry, and on a completely different scale.”
CITY NATIONAL HELPS A NEW ORLEANS BANK RAISE FUNDS FOR REBUILDING LOANS
City National Bank of New Jersey is helping New Orleans’ largest black-owned bank, Liberty Bank and Trust, raise $40 million in rebuilding loans for the latter’s more than 50,000 customers.
Before Katrina hit, Liberty – the third-largest black-owned commercial bank in the nation – had assets of more than $350 million and 13 branches. To survive, CEO Alden McDonald Jr. said the bank needed cash on hand to lend to individuals and businesses as they returned to New Orleans to rebuild. Although the bank is fully operational again, 40 percent of the bank’s staff has not returned to work, having been relocated across the country.
Under the umbrella of Boston-based Access Capital Strategies LLC, in which both Liberty and City National are investors, City National is acting as escrow agent for a nationwide campaign to sell Liberty certificates of deposit called Katrina Investment Deposits (KIDs) that will fund the loans. Access and City National are covering all the costs associated with the sale and providing the off-site staffing to execute it.
“They are doing it for free,” said McDonald in a story on Dow Jones Market Watch. “They are friends, and we’ve had a lot of friends from around the country who wanted to help.”
The KIDs are FDIC-insured for up to $100,000 and, in some cases, up to $5 million. Interest rates range from 2 to 2.5 percent based on the term and amount of the deposit.
MCCARTER & ENGLISH TEAM HEADS SOUTH
McCarter & English LLP subsidized five employees who volunteered to assist the hurricane relief efforts in the Gulf area. After completing the American Red Cross Disaster Relief Training Program, Mark Kurywczak was deployed to Montgomery, Ala., on Oct. 5; Elizabeth Benedetto and Sylvia Santiago Friedman traveled to Baton Rouge, La., on Oct. 7; Catherine O’Connor was deployed to Biloxi, Miss., on Oct. 8; and Laura Mahachek left for Baton Rouge on Oct. 14.
“The firm is proud of the efforts of these brave and dedicated individuals,” said Banking Partner Michael Horn.
In addition to providing manpower to the relief effort, the NJBankers affiliate member firm also contributed $10,000 to the American Red Cross. Horn said that the firm’s employees donated an additional $10,270 to the cause.
VALLEY NATIONAL MOBILIZES CASH COUNTERS
Valley National Bank responded to the American Red Cross Metropolitan New Jersey’s need for cash counters to process the public emergency relief donations. After receiving an urgent call Sept. 8, Valley quickly organized counters from its currency center and transported them to the Fairfield Red Cross offices. A number of Valley National Bank employees volunteered to help count cash that evening and the following Saturday.
Valley also established the “VNB Disaster Relief Fund.” Through this fund, Valley and its employees donated more than $25,000 to the Hurricane Katrina relief efforts.
SUN SHINES ON HURRICANE RELIEF
On behalf of the bank, employees and customers, Sun National Bank presented the American Red Cross Atlantic/Cumberland Chapter with a check for more than $86,000 to support the Hurricane Katrina ongoing relief efforts.
“We all are part of a bigger community that needs everyone’s support and help in times of need,” said Bart Speziali, executive vice president of Sun. “We are truly touched by what Sun’s employees and customers have contributed to the Hurricane Katrina relief efforts and are honored to make this donation on their behalf.”
The total donation includes a $10,000 initial contribution from Sun National Bank to kick off its support efforts. During the collection time beginning Sept. 1, 2005, employees and customers contributed more than $43,000, and the bank made a matching contribution of more than $33,000.
“The American Red Cross is grateful to all of the companies and individuals, like Sun Bank, its employees and customers, who thought it their responsibility to contribute to helping those affected by Hurricane Katrina,” said Pamela Grites, executive director, American Red Cross Atlantic/Cumberland Chapter. “With all of the support coming from across the country, we are working to bring our fellow Americans’ lives back to a sense of normalcy.”
BCPBANK TAKES TO THE AIR
On Sept. 1, bcpbank opened a disaster relief account where customers and non-customers could start contributing in any of bcpbank’s 16 branches and make a charitable financial deposit into a dedicated Katrina Relief account.
The bank’s WE CARE initiative is a fundraising project launched in 2003 by bcpbank and other community partners, with the aim of raising both financial aid and awareness toward victims of disasters around the world. Partnering with the American Red Cross, the Katrina Relief project started collecting donations amongst the communities served by the bank in New Jersey, New York and Massachusetts, with all funds raised being allocated to the American Red Cross Relief Fund. These efforts included media awareness as well as telethon and radiothon events.
“Community involvement is a fundamental component of bcpbank’s vision, and Sept. 1, 2005 marked the beginning of our efforts in providing relief from the devastation caused by Hurricane Katrina. Our branches were immediately available to collect contributions from the public to be used by the American Red Cross towards this humanitarian effort,” said Dr. Pedro Belo, chairman and CEO of bcpbank.
The WE CARE project went further in its fundraising initiatives. Similar to what was done on behalf of the victims of the Asian tsunami and the devastating fires in Portugal, on Sept. 15, bcpbank hosted a telethon/radiothon for the Hurricane Relief effort, which was broadcast live on the Portuguese television station SPT-TV. The WE CARE partnership included Newark’s East Ward Councilman Augusto Amador and media partners such as SPT, 24 Horas, Brazilian Press, Luso Americano and WJFD Radio in Massachusetts. All partners agreed to increase the project’s advertising in order to broaden the scope and visibility of the media event.
The live telethon, “We Care – Hurricane Katrina Relief Effort,” started at 8 p.m. and lasted for two hours. It was viewed by thousands of satellite subscribers of the Portuguese-language television station SPT-TV and aired directly from the bank’s headquarters in Newark. The bank extended its regular business hours to 10 p.m., facilitating walk-in, telephone contributions and pledges.
Running in conjunction with the telethon, bcpbank also hosted a live radiothon which broadcast live from the bank’s Fall River, Mass., regional headquarters via WJFD Radio. This event was also highly publicized in regional media outlets reaching bcpbank’s area of influence in New England. As in New Jersey, the Fall River business hours were also extended to increase the opportunity of walk-in and telephone contributions.
All this hard work proved fruitful from beginning to end with more than $100,000 pledged so far, and more donations pouring in each day.
FIRST HOPE COLLECTS SUPPLIES, FUNDS
First Hope Bank and Pass It Along, a nonprofit agency to which the bank donates space in its Sparta office, embarked on a major campaign to collect items for those displaced by Katrina. The bank and the agency advertised in print and via radio about the collections.
On Sept. 29, First Hope associates and 300 high school student volunteers gathered at the Sussex County Technical School to package all the items collected for shipping. Included in the shipment were: 416 health kits; 128 school kits; 25 Teen Hope-in-a-Box kits; 222 Hope-in-a-Box kits; 500 toiletry kits; 599 baby items; 376 canned goods items; 250 boxed food items; 360 bottles of water; 1,150 items of clothing; and 75 coats. The Hope-in-a-Box kits were filled with age-appropriate items for children or teens to enjoy, such as crayons, jump ropes and toothbrushes and toothpaste.
The bank also donated $3,500 to hurricane relief efforts, representing $100 in customer donations, $1,060 in employee donations and $2,340 from the bank itself.
ATLANTIC STEWARDSHIP OFFERS HELP
Atlantic Stewardship Bank offered aid to hurricane victims on several levels. The bank worked in tandem with Star of Hope Mission to send American Express Gift Cards in $200 denominations to a minister and surgeon in the New Orleans area who distributed them directly to families most in need. ASB donated $1,000 and paid for and processed all the gift cards. A total of $11,000 was sent under this program supported by caring individuals and Paterson churches.
The ASB BEACH Club (Bank Employees Assisting Charities) collected money from customers and donated to the Red Cross Disaster Relief Fund, resulting in more than $1,500 being collected.
At one of its branches, ASB established a fund to collect monies for a New Orleans family that had relocated to Northern New Jersey. The family had lost their home and all of their belongings. The bank had checks mailed directly to the branch and the branch associates process all donations for the family.
ASB mounted a special employee collection wherein the bank matched every dollar donated with an additional $2. That collection netted approximately $6,000 for the American Red Cross Disaster Relief Fund.
On a more personal level, ASB treated a 12-year-old girl, a 10-year-old boy and their mother who fled New Orleans and are staying with a bank customer to see the Broadway show “The Lion King” in New York City.
NORTHFIELD SAVINGS BANK RESPONDS
Northfield teamed with the American Red Cross in Greater New York to aid the victims of Hurricane Katrina by establishing each of its 19 Staten Island and New Jersey branch locations as a collection point for customer and public donations.
Northfield’s customers and friends responded to this call to action by raising $30,000 for the American Red Cross within one month. These efforts, combined with Northfield’s own $25,000 donation, brought the total amount raised by Northfield and its customers to $55,000.
“We thank our customers and the community for the generosity they have shown in support of those affected by Hurricane Katrina,” said Northfield President Albert Regen. “We also applaud the efforts and work of the American Red Cross to provide financial assistance, shelter, food and counseling to the people of the Gulf Coast during this great time of need.”
ORITANI SAVINGS RAISES $25,000
Oritani Savings Bank more than matched customer and local organization contributions totaling more than $12,000 and presented a check for over $25,000 to the Salvation Army.
“I am extremely proud of the spirit of community service demonstrated by the Oritani Savings Bank’s entire branch network,” said President and CEO Kevin Lynch.
“The Salvation Army is grateful to the staff and customers at Oritani Savings Bank who have donated this generous gift to those affected by the disaster wrought this hurricane season,” said Resource Development Manager Tom Wiuff, at the Salvation Army New Jersey State Headquarters. “The Salvation Army has more than 100 years of disaster experience, and is committed to being there as long as there is a need, as long as it takes.”
NJBANKERS COLLECTIONS PROVIDE AID
NJBankers established a hurricane relief fund through Hopewell Valley Community Bank. A total of $16,500 was raised and presented to the American Red Cross from member banks, including a $10,000 contribution from Unity Bank.
“The bank committed to matching any of the contributions made by the employees and directors,” reported President and CEO James Hughes. “We collected $5,000 from the employees and directors, and the bank matched it.”
Also contributing to the NJBankers Hurricane Relief Fund were Advantage Bank, Atlantic Central Bankers Bank, First Hope Bank, Grand Bank, Hopewell Valley Community Bank, Lakeland Bank, New Millennium Bank, Shore Community Bank, Susquehanna Patriot Bank, Two River Community Bank and Union Center National Bank.
In a letter to NJBankers President W. Stuart Cameron, Louisiana Bankers Association President Peter Gwaltney expressed thanks to the association and its members for “their care and generosity during this very difficult time.”
Among other contributions made directly to the American Red Cross and reported to New Jersey Banker were: $1,500 from Bergen Sign Co.; $500 from Pascack Community Bank; and $500 from Hilltop Community Bank, with $300 from its customers.
RAYMOND JAMES CREATES STOCK-GIFTING PROGRAM
St. Petersburg, Fla.-based Raymond James Financial Services, which provides services to customers of Greater Community Bank affiliate Greater Community Financial, has created a stock-gifting program whereby associates, financial advisors and clients may donate shares held in a Raymond James account to the national offices of the American Red Cross or The Salvation Army USA.
Raymond James will liquidate designated shares and direct proceeds to those affected by Hurricane Katrina through the American Red Cross and/or The Salvation Army USA per client instructions. All costs associated with the gifting of stocks, including commissions and wire transfer fees, will be absorbed by Raymond James so that 100 percent of the stocks’ market value goes directly to relief efforts.
This stock-gifting program has been created in addition to the $200,000 donation that Raymond James made on Sept. 2 to the American Red Cross and The Salvation Army in support of Hurricane Katrina relief operations.
“I’m proud to support a program with such emphasis on giving back,” Mulligan said. “It’s the right thing to do.”
NEW MILLENNIUM BANK WAIVES FEES
New Millennium Bank waived late charges and interest for credit card customers impacted by the hurricane. Tellers gave a pumpkin-shaped plush candy bag for each $5 contribution to the United Way hurricane relief efforts. In addition, the bank requested that its employees give generously to charities helping out the hurricane victims.
HUMAN CAPITAL RESOURCES PRESIDENT RUNS GOLF TOURNAMENT
Ray Williams, president of Human Capital Resources and grand knight of the Villa Marie Council Knights of Columbus in Galloway Township, organized and ran a golf tournament on Sept. 21. The week prior to the golf tournament, local Atlantic City radio station Kool 98.3 raised $625 by auctioning off a chance to play golf with the DJ and two tickets to Bruce Springsteen’s Atlantic City concert. Their sister station, The Shark 103.7, raised $1,100 by doing the same and adding two Meatloaf concert tickets. The $1,725 from the radio blitz was doubled to $3,450 by a matching contribution from the Knights of Columbus, which added it to its national hurricane relief fund.
EDCOMM GROUP OFFERS FREE TRAINING
NJBankers Affiliate Member The Edcomm Group is offering teller and compliance eLearning training programs free-of-charge to any bank with headquarters or a significant branch presence in the hurricane-stricken Gulf Coast area.
“Achieving Teller Excellence” is a comprehensive training program that teaches the knowledge, skills and attitude that make tellers successful. “Focus on Compliance,” a computer-based, distance-learning program, can be delivered via Internet, intranet or CD-ROM.
According to Edcomm President Dr. Linda Eagle, “This is a unique opportunity for us to help by providing crucial services that will be needed as banks in this area rebuild and re-staff their operations.”
Timothy E. Doherty is vice president and director of communications for NJBankers. He may be reached via e-mail at email@example.com.