Is There an Afterlife For Big-Bank Veterans In Helping Small Banks?

My friend was downsized.

He had spent over a quarter of a century as a foreign exchange trader and manager for two major banks. Then along came the merger with a bank several hundred miles away, and there went his job.

We met to talk over his options.

While my friend happens to be in foreign exchange, there must be a host of other bank officers who have lost their jobs the same way. And their talents-in trust, lending, marketing, and other areas as well as foreign exchange-should not go to waste.

Since writing this column has given me a community bank orientation, I wondered if there was a way local banks could use the talents of these people without upsetting or replacing staff members.

I asked my friend, "What could you do as a part-time consultant or even on a one-time basis to help a community bank in the foreign exchange area?"

He had several suggestions.

"The great fear community banks have in the foreign exchange area is that when they refer a business customer to a larger bank for some currency transaction they can't handle themselves, the larger institution will try to steal the entire account," he explained. "I could work with the smaller bank to get its customer accommodated at the best price without having to reveal sensitive information on the client to potential competitors.

"I could go to customers of the bank as its representative to help them establish solid procedures when business develops to such a degree that they have to become involved in international operations and payments.

"I could set up risk management and control procedures so that whatever foreign exchange business they do will not threaten the bottom line."

As I talked to him, I thought of other areas where former officers of large banks have been very helpful as consultants to smaller organizations. Several specialize in operations-going out to help make community banks more productive in their procedures and pricing policies. They are only paid based on improvements they make.

Also, I wondered what could be done to bring talent like that of my friend in FX and specialists in operations improvement to banks that could use them. In other words, who could be a matchmaker for banks? Could this be a role for state associations?

Just as an ophthalmologist gives a patient a list of qualified optometrists who can make the glasses and contact lenses he prescribes, a bankers association could develop lists of consultants in specific areas such as foreign exchange.

Of course, in the past there was no need for such a listing. The good old correspondent banker out of New York, Chicago, Boston, or some other major city provided expert advice at no cost beyond the balances the local bank maintained to handle check-clearing.

But it is different today. The community bank knows Bigtown National is still willing to help, but the CEO can look out the window and see a branch of Bigtown National right across the street, trying to steal his accounts.

So maybe there is a place for downsized bankers to consult for community banks on technical issues-ones that arise frequently but not often enough for the local bank to have a staff member trained to handle them.

Let us know your views. Send your ideas to us at 14 Friar Tuck Circle, Summit, N.J. 07901, or fax them to 906-273-7309.

We will publish them to help community banks and downsized officers. And you could become president for a day of our bank, Schmidlap National, which we can guarantee will never become your competitor.

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