by Don Church & Tony Schillaci

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As part of THE RESIDENT’S Financial

District/Bankers on Main

Street series featuring local bank officials,

this is an exclusive interview

with Thomas Borner, Chairman

and CEO of the Putnam Bank with

branches from Putnam to Norwich .

 

The Resident: What was the

inspiration for the Putnam Bank’s

“Go Local” initiative – banking

with a community bank instead of a

megabank? And, how is “Go Local”

working in the towns with Putnam

bank branches.

Tom: It’s actually working very

well. In fact, we are part of the fabric

of the community, and we have been

for 149 years! Soon we will be celebrating our 150th anniversary, and we

have extended our footprint in Eastern

and Southeastern Connecticut. So

many people are realizing that the

entire community becomes stronger

when they buy locally and bank

locally. And, “Going Local” gives

people a tangible connection to each

other on a personal level.

The Resident: How does the current economic situation affect Putnam

Bank, and do you have a sense of

where we are in this economic cycle?

Tom: We can definitely see a

light at the end of the tunnel. Eastern

Connecticut, our region, has fared

better than the rest of the country. We

can see an improvement in our overall

economy, and we are looking forward

confidently to more improvement in

2012.

The Resident: How is Putnam’s

expansion into Norwich and the enhancement of Gales Ferry going…..

especially in light of the continuing

housing market problems? And, part

2 of this question…..are there any plans

to expand along the shoreline in the

foreseeable future?

Tom: These projects are moving

along well. We’re confident that the

housing market will get better. I am

interactive with the employees who

are making the expansion happen.

We really have no plans to expand to

the shoreline because our footprint is

based in the 395 corridor, and that’s

where our core business is localized.

The Resident: Are there any

mechanisms in place to help people

who are already on the brink of foreclosure….or in foreclosure…..to work

with your bank so that they can stay in

their homes?

Tom: Absolutely! We steered

clear of the sub-prime mortgages, so

we are in a good place in that respect.

When we see that we have customers

who are missing payments we call

them and work something out. The

most important thing for people who

are experiencing problems – because

of employment issues, or health, or

financial stresses – is that they need

to act immediately to communicate

with their bank. It doesn’t matter if

it’s a local bank or a megabank – they

should recognize that they have a

chance to change things, and we will

help as much as we possibly can.

We’re dealing with our money, and

the community’s money and the customer’s money so it’s in everyone’s

best interest to want to make negative

situations salvageable. We’re always

interested in hearing from prospective customers, and we will help in

any way we can. But the important

thing is immediate communication

with whatever bank is holding the

mortgage in question.

The Resident: The media seem

to report both positive and negative

stories on the same fi nancial issues

simultaneously. And the market reacts

emotionally with greater volatility on

both fact and rumor. What are your

thoughts on the way the media is

handling financial news?

Tom: The media is interested in

“breaking news.” So it needs to react

immediately – even when the facts

are not right. There are people who

talk on TV and write on the internet

who don’t know what they are talking

about. What we all need to do is concentrate on the long and steady – on

the future. We need to refl ect on the

news and look at the long-term effect,

not on the short term, which will

change with the next “breaking news”

warning, which is most times neither

breaking nor news.

The Resident: What does “go

local” mean to you in as a banker and

as an active member in so many areas

of the community?

Tom: When you “go local”

everyone benefits. Community banks

can now offer all the services that the

megabanks can. But it goes beyond

banking. “Go local” means to shop

locally, and to take advantage of local

professional services. A bulk of jobs

are being created by small business

locally, and the money generated by

going local stays in the community.

It’s this connection to each other on a

day-to-day basis that strengthens the

economy, makes personal alliances

better, and benefits everyone in the

community.

The Resident: In approaching

your bank to set up this interview, we

were impressed with the professionalism, friendliness and enthusiasm of the

people we talked with over the phone. If

this is the way all Putnam Bank employees approach their jobs, what are some of

the other ways that they interact with the

community at large?

Tom: Thanks for being impressed

with our people! That Putnam Bank

attitude starts from the top. We’re all

regular people. I’m not in an ivory

tower. When I send out an email about

a charitable or community project that

needs volunteers, no interaction is

required by our employees. But, there

are usually as many volunteers as are

needed coming right from our Putnam

people.

 

A day after this interview, ABC

News with Diane Sawyer, with correspondent Chris Cuomo, also brought

much-needed attention to how small

community banks are doing what

Tom Borner’s Putnam Bank is doing

to help people who are in danger of

losing their homes – working one-on-one with its neighborhood customers.

That’s one of the many benefits of

doing business with local banks that

are actively involved in every segment

of their own community.

story & photo
by Alexis Ann

Interview with Bruce J. Fafard, President and CEO, Ledge Light Federal Credit Union

Bruce J. Fafard, President and CEO, Ledge Light Federal Credit Union, stresses the importance of community in his credit union and says that, at his institution, “We’re here to help people with their financial lives.”

Bruce began his job as CEO of Ledge Light Federal Credit Union on April 31, 2007. Now, a little background on credit unions, they are owned by their deposit holders, unlike commercial banks which are owned by their shareholders.

The credit union is open to those working for Pfizer, its subsidiaries and employees of the companies that work within Pfizer Inc. Ledge Light is also open to the families of those people and the employees of the credit union itself.

In its early years it was only open to, “The Pfizer community,” stated Bruce. Now, membership is open to 69 businesses, called Strategic Partners, including Cardinal Honda, Court Square Data Group, A/Z Corporation, K Force, and TVACCA, and persons who live, work, worship or attend school in, and businesses located in 12 census tracts within New London County. Visit www.ledgelightfcu.org to see if you or your business qualifies.

Ledge Light Federal Credit Union opened its doors 41 years ago, when six Pfizer employees decided that they needed their own financial institution. To this day, the credit union enjoys close ties to Pfizer.  Since credit unions are owned by their deposit holders, Bruce says, “When Pfizer prospers, we prosper.”

In Ledge Light’s commitment to helping the community it serves, steps were taken to offer aid including preparing taxes for lower income households.

During last year’s tax season, 12 of Ledge Light’s employees took IRS classes in order to help households earning $50,000 a year or less prepare their taxes. Bruce was one of the employees who decided that he wanted to help out his community through this free tax preparation program.
The credit union tries to help everyone it can. Recently, a single mother applied for a loan and was approved, though she probably would have been turned down at another institution.

Bruce explained how this young mother needed the loan to get a car so that she could go to work to support her children, “These are the things that make my job worthwhile.”

“We don’t just look at your credit score,” though it does certainly play into whether the customer is approved for a loan or not.  “We look at the person’s ability to pay back the loan.”

A credit rebuilder program is offered to Ledge Light customers who need help building a better credit score and getting their finances in control.
“We try to work with people,” states Bruce. “There are times when we may advise a customer that a purchase is too big for them.”

Ledge Light Federal Credit Union offers every kind of financial need, from loans to credit cards. For example, the credit union offers Visa’s Platinum Preferred Card which is a lower interest credit card and has a number of convenient features such as ATM accessibility.

Bruce admits that although his credit union is doing well, “2010 will be a tough year.”   His prediction is that the unemployment rate will increase a bit. However, “In this part of Connecticut we’re holding our own.”

Ledge Light has not done sub prime lending or interest only lending and they have continued to lend during the recession. As for a few years down the road, Bruce says, “We’re excited about the future.” Ledge Light Federal Credit Union is doing well in this area of Connecticut and will continue to do so.

Bruce earned his undergraduate degree in finance from Southern Connecticut State University and his M.B.A. from the University of New Haven.
Bruce worked in a number of different fields before settling at the bank when, in 2007 his current job opened up and he applied for the position. His career path includes time spent working at Sikorsky Aircraft and owning a commercial flooring business.

photo & story
by Jessica Warzeniak

Dime Bank introduced its “small business stimulus program” in a press conference on Thursday, December 10th. Jim Cronin, president, Dime Bank, announced that Dime put together a “$10 million loan pool” to help local small businesses and non-profits in need of financing in these difficult times. Jim said that the program is targeted toward credit worthy businesses and non-profits which, for example, are in need of funding for working capital, expansion, to upgrade or replace equipment or for those that would benefit by restructuring existing debt with more favorable terms.

Jim stated that the general perception is that banks are not lending which is prolonging the recession and preventing a recovery from beginning. “Small businesses are suffering,” he said. “The national media says that banks aren’t lending, but it’s not all banks. The larger banks might have stopped lending, but community banks have not closed their windows at all. They continue to lend. Dime has lent $32 million already this year.” Jim feels the negative press has many businesses reluctant to even approach a local bank. “It’s a self fulfilling prophecy. The feeling is, ‘Why apply when they aren’t giving any loans?’ Community banking is different. We truly serve the community.”

The program is designed to help those business and non-profits who demonstrated a successful operation in the past, but find themselves having difficulty obtaining the necessary financing. “It’s not a grant program,” said Jim. “It’s a loan program with normal bank underwriting requirements. They are what they are, and what they always have been. The businesses must show they are successful and have a good business plan. There must be an expectation for success.” Dime will evaluate each situation on its merits and, if the business is credit worthy, attempt to structure financing under terms and conditions that are most suitable to the business.

This stimulus package comes at a time when large institutions and credit card companies are cutting lines of credit and the government is cutting funding for non-profits. “We wanted to take the initiative as a community bank to do something positive,” said Jim. “We wanted to help out local businesses and through that, the economy.”

Based on successful programs in the past, Dime realized the way to stimulate the local economy is to create a specific loan program with a designated loan pool. “We put a dollar amount on it with a program and discounted the rate by half-percent,” said Jim. “They ask, ‘Why would we do that with delinquencies rising? Why would we take on more risk and compound that risk by reducing the rate?’ Because that’s what community banking is all about!”

“We think this will have a major impact on our local economy,” said Jim. “We hope that it will preserve and protect jobs and actually create new ones. We think it will be the breath of fresh air that is needed. It’s what the doctor ordered. It’s what small business has been waiting for.”
Jim encourages any local business or non-profit that is in need of financial assistance to visit any of their 11 convenient locations or call the following, in CT: John Estelle or Chris Gauthier at 860.859.4300 or in Westerly: Tony Antoch at 401.596.4742.

by Alexis Ann
photos by Kate Barrett

Hardworking” and “community-minded” would describe Tom Borner, Chairman of the Board and CEO of Putnam Bank in Putnam and principal of the Law Offices of Borner Fraser and Aleman, Putnam.

The law office needs as much attention as the bank and Tom Borner praises his colleagues, saying, “I have the three best lawyers in the world working for me.”

Tom says of his banks, “We are the community,” which shows through donations like Putnam Bank’s gift of $5,000 to Three Rivers Community College. This donation will be used for one of the college’s scholarships.

“We’re here to stay.” Putnam Savings Bank opened its doors in 1862.  An avid history buff,  “The bank has survived the Civil War, World War I and II, the 1929 stock market crash and a few other marked points in history.”

Putnam Bank has eight full-time branches and utilized its locations on I-395 to expand. “We are pretty fortunate, 395 has done a lot to bring us together with Norwich.”

In the way that Connecticut was once connected by its railroad and trolley system, I-395 connects all of Eastern Connecticut, today. An example of Putnam Bank’s usage of I-395 is reflected in the October 14, 2009 opening of a new branch in Norwich.

Since giving back to the community is always important, Putnam Bank also donated $1,000 to the Norwich Fire Department on the same day as the grand opening.

On the bailout,  “Unfortunately, it was essential because of bad practices of big banks.” Small community banks like Putnam are more careful in choosing who they loan to.  “We’ve always had conservative lending.”

Banks are completely different from when Putnam Bank first opened over 160 years ago. “People now see us all the same due to the fact that many don’t know about the evolution that banks have undergone.  For example, for the first 120 years we couldn’t have checking accounts.”

People always relied on two different banks for their financial needs, one was for savings and the other was for checking. In 1980, commercial and investment banks were finally able to merge after years under the Glass-Steagall Act, which separated bank types.

Today’s financial atmosphere is still shaky and people aren’t as comfortable as they were but that seems to be turning around. “People are feeling better,” about their financial situations.

Although many have hit on tough times, New England seems to be doing better than many other parts of the country. This is due to the fact that we are, “No longer dependent on any one sector.”

In speaking with bankers from other towns across America, “Dearborn, Michigan, is an example of harder times elsewhere, where I was told, “You don’t know what it’s like. We have people coming in, in tears. They’ve paid their mortgage for 20 years, only have 10 years left, but say there’s no way.”

Extending his hand to the community beyond the bank, Tom and his wife, Katalin are involved with Habitat for Humanity making regular trips to help build homes for needy families, and a 20-year record of helping out with the Woodstock Fair.

by Jason Alderman

Until you get in the habit, putting aside savings is never easy. But the sooner you start, the sooner you’ll start seeing results.

When you reinvest interest earned on savings accounts or other investment vehicles, the interest grows the account’s value much faster than if you withdrew it.

You needn’t start with such a large initial investment to reap big rewards. Say you’re 21, start with a zero balance, save $100 a month, earn six percent annual interest and reinvest the interest. After 10 years you’d have $16,470; and $46,435 after 20 years.

Timing is important. Postponing your savings by only two years would reduce your balance in 20 years to only $38,929 – more than $7,500 less.

Another way to accelerate earnings is to take advantage of tax savings offered by retirement savings programs like 401(k) plans and IRAs. With a 401(k), you can contribute up to $16,500 a year on a pre-tax basis. This lowers your taxable income and allows your account to grow tax-free until you withdraw the money at retirement.

Regular IRAs offer similar pre-tax advantages; or, you can contribute to a Roth IRA using after-tax dollars and your earnings will be completely tax-free at retirement.

The riskier an investment, the greater your potential gains – or losses. Savings accounts offer lower interest rates in exchange for minimal or no risk, whereas stocks potentially can earn double-digit investment rates over long periods of time, but at much higher risk.

Inflation measures the rate at which goods and services increase in cost over time. If your investments earn two percent interest but the inflation rate is three percent, the net result is a one percent loss.

Keep in mind that no matter how much interest your investments earn, if you carry forward credit card or loan balances (aside from tax-deductible mortgage interest), you’ll be eating into whatever profits you might make.

For more information and tips on managing money, visit Practical Money Skills for Life’s site www.practicalmoneyskills.com.