Wednesday, May 20, 2009

Banking Should Not Be Exciting

My good friend and former law partner, Ken Koonce, sent me the following quotation:

“"Banking should not be exciting. If banking is exciting there is something wrong with it." CLAY EWING, president of German American Bancorp., a community bank in Jasper, Ind.” [The entire article is worth reading, so click on the link].

For years Ken and I have argued good-naturedly about anything and everything—it’s sort of a lawyer’s recreation—but on this point we agree: Banking should not be exciting.

There are certain activities, and banking is paramount among them, that require caution. As the saying goes, there are bold pilots, and there are old pilots, but there are no old, bold pilots. There aren’t old, bold banks either.

For years community banks, savings and loan associations and credit unions have run on the 3-6-3 rule: Pay 3% interest on deposits, charge 6% interest on loans and be on the golf course by 3:00 p.m. Many still operate on this system and, on the whole, that’s a good thing. The bank makes a modest amount of money and your deposits are safe.

I don’t know about you, but I don’t want a brilliant, energetic, innovative technocrat handling the money in my savings account. If I wanted that, then I’d put the money in some high tech start up. For my banker, a dull and stolid person who regards doing yard work as excitement enough, is just the right person. Let banker’s work short hours for modest pay. Let them have no new ideas and take no risks. Everything has its place and banks are places of quiet and order—no place for the ambitious.

We are not all the same and thank God for our differences. Not everyone needs to be brilliant. Not everyone needs to be rich. Not everyone needs to work eighty hours per week. Some jobs and some businesses are best served by a person that clocks out after eight hours and goes home—where his or her family and real life are.

The next time I am in the market for a new banker, I think I’ll head to the golf course at 3:00 p.m. and find one on the links. Then at least I’ll know he’s not in the office thinking up some new and more exciting way to lose my money. Unfortunately, the banker in the picture has retired from banking to full-time golf.

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