ABA Banking Journal - August 2007 - (Page 45)

Compliance Clinic Date first, marry later Mobile, Ala.’s, Commonwealth National Bank finds slow and steady approach works best when courting the “unbanked” W hen it comes to reaching out to the unbanked, Sidney King counsels moderation. He favors letting people who haven’t used the banking system before, or who had a bad experience and left it, make their way in gradually, rather than encouraging them to jump in at the deep end with both feet with a mortgage or other major financial commitment. King, president and CEO at $56.7 million-assets Commonwealth National Bank, is a strong believer in the necessity of people having a stake in the banking system. “Having a banking relationship helps a person learn the discipline of money,” says King, a veteran banker and a CPA. “Without learning that discipline, no person can get out of poverty. And without the discipline of money, those people can only teach their children poverty.” In a sense, King’s job, and that of his minority-owned bank, is to help people break that cycle. The bank can’t do it for them, but it can provide opportunities to do so. But King urges the slow-and-steady route. He explains that some prospective customers come to Commonwealth National hoping to take out a loan the day they walk into the lobby. That’s not what King or Commonwealth are about. “We say, ‘Come on in and open a checking account, let’s get to know each other better, first’,” says King, who told the bank’s story during a panel discussion in banking in ethnic markets at ABA’s recent Regulatory Compliance Conference. This is a philosophy that King calls “Dating first, marrying later.” Using employees’ children in newspaper and other advertising has helped Commonwealth National Bank underscore its call to Mobile’s AfricanAmerican community to bank with the minority-owned institution. Mobile’s black-owned bank Commonwealth National had to work at making its own way into the banking system, in the early 1970s. As King wrote in a history of the bank that he put together for the Comptroller’s Office, when the bank’s founders began organizing the black community of Mobile, Ala., to capitalize the state’s first minority-owned bank, success was elusive. Founders had been told by OCC that $1 million in capital had to be raised to open its doors. The group canvassed all over, concentrating on organizations and institutions that play a big part By Steve Cocheo, executive editor in the African-American community’s life. Church congregations were especially targeted. However, after several years of effort, the capital pool was still short of the mark. OCC agreed to hear out the founders’ business plan based on the $750,000 that it did raise, and, with the agency’s decision to approve the application at that level, the bank opened its doors in 1976. The bank started in a trailer, in time moving to permanent headquarters and opening two branches. Today, the bank still ABA BANKING JOURNAL/AUGUST 2007 45 http://www.cnbmobile.net

Table of Contents Feed for the Digital Edition of ABA Banking Journal - August 2007

Contents Editor's Column The Unbankers Snapshot: Do Share Repurchases Signal More M&A Activity Sleight of Mind Goals Behind Proposed ABA/ACB Merger ABA Resources ABA Chairman's Position Should You Sell Those Nonperformers Pass the Aspirin Branch Design - Evoking a Sense of Place Two Banks Take the LEED Move Over, Buddy Service Feature: Bankers' Banks Directory Websites: What's State of the Art for Banks? Citi Mobile to Go Strong with iPhone? Date First, Marry Later Mailbox Banker's Mart To Advertise/Index of Advertisers The Economy

ABA Banking Journal - August 2007

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