Sensible strategy nurtures year-old Bank of George

By Nicole Lucht

Friday, March 6, 2009 | 2 a.m.

More than a year ago, Bank of George opened its doors, and since then its assets have quadrupled.

When the bank opened in September 2007, it had $22.5 million in assets. As of last September — the most recent figures available from the Federal Deposit Insurance Corp. — it had $101.3 million in assets. The bank has increased its deposits from $2.3 million to $82.7 million as of September.

The bank listed no problem loans or leases.

Bank of George has been heavy in commercial lending, loaning $39.4 million to commercial real estate, construction and development projects. Another $24.2 million has been loaned to commercial and industrial projects.

Diane Fearon, chief executive of Bank of George, said the community bank doesn’t lend to businesses that are losing money, but rather to those that are well run. Its clientele includes doctors, lawyers and accountants, she said.

The bank doesn’t offer mortgage loans — the ones offered to borrowers mature in 10 years or less, she said.

“What I see with Bank of George is, fundamentally, we’re a good, solid community bank that you can deposit your money safely and securely with and who will support you in making loans to have you grow and be stronger,” Fearon said. “We can’t make loans to businesses that are losing money. That doesn’t make sense.

“However, we have the ability to really evaluate an individual customer relationship and be a bit of a business partner with them, that we benefit from, as well as the customer benefits from.

“Those things will always be why Bank of George will be successful,” she said. “I say that in very changed circumstances, that’s still what business needs and that’s still what we have.”

The bank is still following the business plan it developed before the economic recession and credit crunch.

“(Businesses) still need to have a really good bank with a good banker and somebody who can take care of their business and cares about the fact that we get the opportunity to do so,” she said. “That hasn’t changed.”

Part of original business plan was focused on having the right board of directors and having the right tier of shareholders, which Fearon said the bank has.

Although Bank of George is a privately held bank, of its 187 shareholders all but 30 do business with it.

Part of that process included evaluating whether the bank would be a good fit for the investors as well as a good investment alternative.

“A lot of the business plan was built around having the support, especially in the first year, of our shareholders, to get us going in a strong and solid manner,” Fearon said.

That, Fearon said, has been successfully executed.

“Once you do business with people and you do it well, they tell others, and that’s where the future of Bank of George comes from,” she said.

A primary profit vehicle for a bank is lending. But there has been less of a demand for loans, Fearon said. Instead of describing the current economic climate as a credit crisis, Fearon called it a “consumer confidence crisis.”

She said the public outcry of banks not lending is “not a true and full statement.”

Banks such as the one she manages have taken a strong position in maintaining liquidity to accept new loan requests and add customers, Fearon said.

“We’re not getting the requests we would have gotten 18 months ago,” she said. “And I would think that is happening throughout banking, which all ties into the fact that the consumer confidence crisis is (making) everyone be more cautious.”

The bank recently passed a milestone: 1,000 deposit accounts. The bank is continuing to grow “very thoughtfully.”

There will be a regional president for the Henderson office, which is opening later this month, and the bank has capitalized on the poor economic conditions to pick up other key employees.

There aren’t any plans now to open a third branch, but the bank may consider that option in two years, she said. The bank’s flagship office is in the southwest valley at 9115 W. Russell Road.

“It isn’t just growth for the sake of growth,” Fearon said. “It needs to be relationship oriented, long-term oriented and to truly provide a benefit and service to the community at large. That’s what Bank of George was designed to do.

“We’re staying on track with where we always intended to go. The bank has a great belief not only in the country, not to be too broad, but in Las Vegas. Southern Nevada is not closing up shop.”

Nicole Lucht covers health care, workplace and banking issues for In Business Las Vegas and its sister publication, the Las Vegas Sun. She can be reached at 259-8832 or at [email protected].