Banks see lending key to region

THE NEXT STEP: High school senior Cheikh Gaye works with College Visions adviser Gleyribel Rodriguez on filling out financial aid forms. College Visions has been chosen by Bank of America to receive a $200,000 grant spread out over the next two years. / PBN PHOTO/RUPERT WHITELEY
THE NEXT STEP: High school senior Cheikh Gaye works with College Visions adviser Gleyribel Rodriguez on filling out financial aid forms. College Visions has been chosen by Bank of America to receive a $200,000 grant spread out over the next two years. / PBN PHOTO/RUPERT WHITELEY

The adage that giving comes back to the giver has proved itself in the banking world in Rhode Island and southeastern Massachusetts, say executives experienced in institutional philanthropy.

“I know that it’s cliché,” said Michele Roberts, executive vice president and community relations officer at Bristol County Savings Bank in Taunton, and clerk of the bank’s charitable foundation, “but honestly, the two CEOs I’ve worked for get it: They truly believe that when you give it out, you get it back. And they truly believe it’s the right thing to do.

“Because we certainly don’t get back dollar for dollar what we give, but if the community is successful, the bank is successful,” she said.

She cites a 22-year-old program, “Saving Makes Sense,” in which five schools and the bank partner with the Massachusetts treasurer’s office to open savings accounts for children, start them out with funds and a curriculum, and every few weeks have students make deposits. Today, many of those students are bank customers, taking out mortgages or student loans or car loans, Roberts said.

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“We have better than a 50 percent retention rate for those kids,” Roberts added. “We’ve definitely seen an increase in business as a result of our charitable giving and outreach. We’ve seen an influx of business as a result of the relationships we’ve built – long-term, solid relationships.”

The bank is a mutual savings bank, meaning it does not have shareholders. That’s where the strategic plan comes in, establishing the communities the bank serves as stakeholders, Roberts noted.

The bank’s charitable foundation manages about $10 million, continuously grows that funding, and has budgeted $1.5 million to give out in 2015, following on the heels of more than $1 million a year over the last four years, she added.

Bristol County Savings Bank, which also serves Rhode Island in addition to the Massachusetts South Coast, is hardly alone.

Bank of America, The Washington Trust Co. and Citizens Bank told Providence Business News they practice charitable giving through established foundations. In fact, key executives at all three banks echo Roberts’ view that philanthropy is central to the financial institutions’ mission. Priorities range from hunger, affordable housing, and economic and workforce development, to arts and culture.

William F. Hatfield, Rhode Island market president for Bank of America, said a recent investment in College Visions, a nonprofit that helps low-income and first-generation students attend and graduate from college, was made with the idea in mind that philanthropic investment fosters economic self-sufficiency.

And that financial independence can and does translate into more customers for the bank, he said.

“We are absolutely a for-profit company that has the privilege of serving not only Rhode Island but communities across the country,” Hatfield said, “and we know our success as an organization is directly linked to the health and vibrancy of the communities we serve.”

The Bank of America Charitable Foundation gave approximately $200 million in 2014 across the country, and approximately $1.4 million of that was in Rhode Island. Donations and grants translate into new and continuing customers, he said.

“We look at our investments that we make in the area of workforce development, education and affordable housing as core investments that enable Rhode Islanders to be contributors to a healthier economy,” he said. “In doing so, the tide is raising all boats, making the environment healthier. Through engagement with customers, we have a better opportunity to serve them and serve our shareholders in a way they expect to be served.”

While Hatfield couldn’t cite statistics, he said the bank is “metric driven,” and as such awards grants based on tangible potential outcomes while continually measuring success.

College Visions, which has been chosen by Bank of America to receive a $200,000 grant spread out over the next two years for its programming for the Providence metro region, is thrilled to be on the receiving end of funding that it believes will make a difference in services it can provide to students with “extremely limited resources,” said Simon Moore, the nonprofit’s founder and executive director.

Typically, someone who has a bachelor’s degree earns more than $20,000 a year more than someone who doesn’t have a degree, Moore said.

“The bank has recognized that organizations like College Visions are doing important work, [so they] have invested a lot in our plans for growth,” he noted. “By helping young people get into college and earn a degree, our participants are setting themselves up for real career options and financial stability. We know that this kind of work impacts young people, makes them more financially stable in the long term. In [donating], the bank is improving their [potential] customer base.”

Citizens Bank and Washington Trust representatives expressed similar confidence in and commitment to philanthropic investment as a means to foster healthy communities, and indirectly, grow their customer base. However, Edward O. “Ned” Handy III, president and chief operating officer of Washington Trust, said the bank looks at its philanthropic efforts more in terms of helping communities than developing future customers.

Partnerships with organizations, including the Providence Bruins and Pawtucket Red Sox, for instance, help communities meet areas of critical need, Handy said. He also cited a peanut butter drive held for Rhode Island Community Food Bank that was set to kick off this year on March 1.

“It does more for the brand and helping our customers and the residents in our communities than it does anything financial [for the bank],” he said of the bank’s philanthropy. “We value most being known as a place that gives back and pays it forward. There’s an increasing expectation that companies like us are engaged and involved, and we’ve been that way for a long time.”

Kathy O’Donnell, director of public affairs for Citizens Bank, added that giving back to local communities “is embedded” in her bank’s culture.

“Giving back to the community through financial and volunteer support is at the foundation of who we are as a company,” she said in an email. “We give back because it is the right thing to do and because we believe that if the community prospers, we all prosper.” •

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