The Value of Belonging

As president and CEO of Litchfield Bancorp in Litchfield, Conn., and past chairman of the former America's Community Bankers, Mark Macomber knows mutual institutions and

Macomber pointed out that mutuals are well represented in the ABAs leadership. Of the 47 total board directors, 12 are from mutual institutions. ABA bylaws require that at least three members from mutuals be on the board when it reaches its final, post-merger size, and at least one mutual member be on the executive committee. The Mutual Institutions Council also must be maintained under the new bylaws.

Dana Stonestreet, president and COO of HomeTrust Bank in Asheville, N.C., said the merger of the ABA with America's Community Bankers is particularly advantageous for mutuals. "With the combination, we have the best of both worlds," he said. "The new ABA has the largest professional staff to offer expertise in the area of banking, and it also has a real commitment to mutual institutions through the Mutual Institutions Council."

Stan Jenks, president of security Bank in Monmouth, 111., shares his colleagues7 assessment. "Mutuals find membership in the new ABA to be a real benefit, especially after the merger between the ABA and ACB " he said. "The new ABA supports choice in charter and ownership and has provided considerable resources to the Mutual Institutions Council. With the merger, the support of mutuals is stronger in advocacy as well as in the products and services offered by the ABA "

Among those products is the recent ABA publication, Corporate Governance for Mutuals. "Only ABA has the resources to produce that [publication]," Macomber said. Stonestreet cited as particularly helpful the information available for mutuals that are changing or considering changing their traditional focus on retail banking. "Mutuals need to continue looking to expand their business model to include commercial banking," Stonestreet said, "and ABA offers a lot of resources to assist them in doing that."

Another advantage of membership, he said, is that it offers opportunities for peers to meet and share their experiences. "At our conference, we can get together and talk about what's relevant to us," Stonestreet said. "We need to have those opportunities going forward, and I don't know any other way [than membership] to have that."

Brian D. Lanigan, first executive vice president and chief operating officer of Middlesex Savings Bank, Natick, Mass., also considers collegiality one of the main advantages of membership. "Through its conferences, publications and membership in the Mutual Institutions Council, ABA brings together leaders of mutual banks to provide a broad forum for discussion and action on relevant issues," he said. "These include legislative and regulatory issues, corporate governance matters, concerns with unfair credit union competition and efforts to address accounting issues unique to mutuals."

For ABA to work most effectively, its members need to be active participants in association activities, [enks said. "We must be involved in the legislative and regulatory arenas and use the strength of the ABA to continue delivering our message of how we serve the communities of America with a proud tradition," he said. And as the number of mutual institutions dwindles, their trade associations support becomes even more crucial. "There are fewer than 1,000 mutuals now; there used to be 5,000," Stonestreet said. "We are a minority. We need a strong trade association - strong people - speaking for us."

Membership evidently has provided that in the past - and they look forward to it continuing. "Over the years, ABA has consistently and relentlessly demonstrated its strong support of the mutual bank and mutual holding company charters through its efforts to educate legislators and regulators on issues specific to mutuals," Lanigan said. "As demonstrated by its recent combination with ACB, ABA is clearly committed to bringing together the industry's most talented people and greatest resources to preserve and promote the manybenefits offered by mutual institutions."