The localism of the past period before deregulation is not the perfect solution for the future of the banking industry, but the best practices of the era did include the long-term success of the bank was interdependent on the local presence and impact to insure financial health and opportunity for consumers and community served. The bank could not sustain success in the community without a healthy and vibrant community and consumer, and the impact of all three is profound to the real economy locally and nationally.
In today’s modern banking, the financial system and the regulatory structure stand in peril providing a viable, self sufficient system as the consumer and the community are not the benefactors of the financial system or the regulatory model. The current financial model does not bring the stability of localism in today’s current crisis. The lack of stability does question the sustainability of the present system as many demographics do not have access to banking services, personal, financial illiteracy threatens society, and confidence is lacking in our financial system. In the past economic crisis, localism in the banking industry did bring stability to past economic crisis by instilling confidence and trust in the system, promoting self-sufficiency in the community, and promoting innovation via the community bank presence. The community banks did provide local bankers with a business model to realize profitability to the bank, representative of the local community to provide community finance and savings needs, and a partner to the consumer in the community to provide savings and loan products.
The bank did hold a core value that a healthy bank, consumer, and community was a trifecta impact to sustainable economic growth locally and the real economy. In the post war period of 1945, the driver of widespread prosperity in the United States was the banks providing the safe places for deposits, and the destination to provide loans needed in the community. The localism in the bank was the measure of strategic success in revenue generation of the bank, impact of the bank in the community, and partners to consumers in bringing opportunities to save, borrow, and explore business opportunities. The localism in banking did bring a self-sufficiency to the local community and consumer, and financial literacy not present in the financial system structure of today.
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- DC Community Banks must strategize to survive (donny-wise.com)
- One Size Does Not Fit All (citizensnationalbank.wordpress.com)
- Community banks team up to fight the megabanks (money.cnn.com)
- Do small business insurance customers have a bad relationship with their bank? (premierlinedirect.co.uk)
- Wanted: Political leadership with ordinary world experience to resolve financial system crisis (donny-wise.com)
- Bill Posey: Stop overregulation of community banks to spur local investment, economic recovery (tcpalm.com)
- Community banks are getting stronger, Fed chairman says (oregonlive.com)