Disturbing Thoughts

Something Odd
Giant Assumptions
“We’re Going to Have a Crisis”
Austin, Dallas, and ???

Remember when banks were small? Those old enough to have a bank account in the 1970s should. Back then, most people did their banking with a locally owned institution, often the First National Bank of (Your Town).

These were fully independent banks, not branches of bigger ones. You could walk in and see the bank president sitting at a big desk. Even major cities had neighborhood banks, serving the people who lived nearby. That’s just the way it was.

Large banks existed mainly in big skyscrapers downtown which most people had no reason to visit, serving big businesses while small banks served small businesses and the masses. If you needed a loan, you would put on your best clothes and go ask for one, often speaking to someone you knew from church and school functions.

Those small banks, while not totally gone, are no longer normal. The system that replaced them is less personal but more efficient and convenient. It has enabled enormous economic growth. Yet I can’t help feeling we lost something important along the way. My current bank doesn’t understand—or even want to understand the unique aspects of my business. It wants to plug me into a cookie-cutter financial model, which dictates new terms for my line of credit.

Seriously? I don’t blame them. They need sterile, standardized models to be efficient. My current “banker” whom I have never met has no authority to do anything but follow his models. Reasonable caution on their part but I’m sure this is happening to small businesses all over the country. Money costs more and banks want more collateral. But it is forcing me to change my own business model.

Life was simply easier with local bankers. I followed one banker to four different banks over 15 years before he moved too far away. He knew my business as well as I did. But that was a long time ago in what seems a galaxy far, far away.