Q & A

Paul A. Schosberg, president of the New York League of Savings Institutions for the past 18 years, is possibly the best-regarded thrift association executive. Energetic and savvy, he runs one of the industry's most influential groups.

But mergers and failures have cut the league's membership to about 60 thrifts. Now it is nearing a merger with the Savings Bank Association of New York, which was also dwindled to about 60 institutions.

In a recent visit to the Washington Bureau of the American Banker, Mr. Schosberg said associations have to change in sync with the industry. He thinks New York's example is influencing the merger talks between the U.S. League of Savings Institutions and the National Council of Community Bankers.

American Banker: Why is your association talking merger?

Paul Schosberg: Trade associations really ought to try to get a little bit ahead of the curve. If they're going to really help their industry, they've got to be willing to take that kind of risk.

AB: Are any associations ahead of the curve?

PS: It's an anomaly in trade groups. They should be made up of people who identify future trends that are going to reshape their industries and who do the "what ifs."

But the very people who should be pushing and prodding tend to develop an inertia. It stems not so much from the issues they think about, or their vision of future forces, but from a locked-in mind-set and a style of doing things the way they've always been done.

PS: I hope so. I think you're going to get more bang for the buck that way. Some regions perhaps are more susceptible to it than others. I can see it in the Northeast and in the Southeast.

AB: How are the U.S. League and National Council talks progressing?

PS: It surprised a lot of people how rapidly they got serious. They are talking about having commitments in principle, possibly by yearend. In other words, the decision to do a deal.

The mechanics can be just incredibly tortuous. You've got a lot of people, a lot of bucks involved. Playing mix-and-match is not easy.

They took a page out of our book. We agreed two years ago to turn the process over to the owners and put staff in their proper role. Get the owners around the table because they're the ones who will benefit.

AB: Should thrift and community bank associations combine?

PS: Downstream, sure. You'd just be fooling yourself if you didn't think that. We are trying to build a new trade association around the concept of community lending, and we're still going to have trade associations tripping over themselves after that is done.

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