Small Town Banking

From the NY Times comes a remarkable look at the "other side" of the banking industry: a small town bank in Nebraska, which is only in the news because it was recently robbed for the first time in half a century.

Yes, institutions like this one still exist in America. They may not have economies of scale going for them, but they are well-managed and in the closest possible contact with their customers. And they are most certainly not lining up for federal bailout dollars.

Its one-story brick building, built as a bank more than 100 years ago, has remained a local fixture while most buildings in downtown Carleton, such as it is, are bricked up or closed up: the old Weddel’s grocery store; the old post office that partially caved in a few years ago; the old Little Café, where Thelma and Shirley sold fresh pies of apple and cherry.

Just outside the bank, a Cargill grain operation grinds away. Truckloads of soybeans and corn are weighed and dumped with a sound like a sigh into the mammoth grain elevators looming over the empty storefronts. Every few minutes, another long Union Pacific freight train loudly announces itself.

Inside the bank, Mr. Van Cleef, 46, is usually helping local farmers figure out how to finance the fertilizer, chemicals, machinery, fuel and irrigation needed to grow their crops, all while guessing what beans and corn will go for.

There is no online banking here. It’s all face-to-face, how are you, Mike, see you later down at TJ’s for a burger.

The Van Cleef business has not exactly followed the Wharton School model. Mr. Van Cleef’s father, Lloyd, 72, was a Navy veteran working as a meter reader for a gas company in Fairbury, about 40 miles away, when a local banker offered him a career change. He worked his way up the banking ranks and then, in 1975, decided to buy the Citizens State Bank in Carleton.

His teenage son, Michael, did not appreciate moving from a town with a Pizza Hut and a movie theater to a town where the passing trains served as entertainment. But he started working in the bank after high school, attended banking seminars instead of attending college, set aside aspirations of law school and eventually became a bank president without pinstripes.

“You do loans, you do deposits,” he says. “You scrape the snow outside. You change the light bulbs.”

Go read the whole thing. And admit it: you want to live in this town and do business with this bank.