The spirit of community banking dies hard in Utah - especially in Orem, Utah.

As their small, profitable banks have been taken over by superregionals, Orem community bankers, with remarkable regularity, have spurned job offers with the interlopers to start their own banks - or to join other start-ups in the area.

Apparently, many of their customers have also showed their devotion to community banking by following their original bankers to the new community institutions.

Take the former Deseret Bank, which opened in 1911. When the family that controlled the bank chose to retire, the Deseret board agreed to merge with Salt Lake City's First Security Bank.

Years of Experience

Deseret's former senior vice president, together with two other officers, left to start Western Community Bank - which has averaged a return on assets of 1.5% to 1.6% since it opened on Dec. 9, 1991.

"The area was losing six offices of community banks [to First Security], so we took a chance on starting one, and it turned out to be a good thing," said Craig Forsyth, president and chief executive of Western Community.

"We attracted many of our former clientele because of the years of experience we have. It was a better-than-anticipated shot in the arm than if we had been the new boys on the block."

Western Community, which now has $14 million of assets, $10 million of loans, and $12 million of deposits, operates barely four miles from the former Deseret headquarters.

Customer Base

Meanwhile, four miles from Western Community, another Deseret veteran, former president Hal Allen, set up the Orem Community Bank.

Mr. Allen, Orem Community Bank's president, said the bank's deposit growth and loan growth already has significantly exceeded his projections, with assets of over $5 million and loans of $1.5 million.

But with Western Community Bank already having a year-and-a-half head start on courting former Deseret customers, who else is there left for Mr. Allen's bank to attract in the city of about 70,000 people?

Answer: The former customers of another Orem casualty - Wasatch Bank.

Like Deseret, Wasatch was a healthy, well-managed bank, making it a perfect acquisition target for Zions First National Bank. After the merger was completed on Nov. 1, Wasatch's former president, Clint Williams, transferred to a two-year-old community bank, First Commerce Bank, in Logan, after toying with the idea of setting up his own bank.

Making Accommodations

Despite their successes, the determination to continue to nurture community banking has taken a temporary toll in creature comforts.

Mr. Allen's bank has been operating out of a converted mobile home parked at the construction site of the bank's headquarters. While keeping "one eye on every nail being pounded," Mr. Allen presides over his staff of seven, who work at the four desks and two teller windows.

Mr. Williams, 44, may have avoided the hassles of starting up, but he also had to make several personal accommodations to stay in the field.

"That I would move 180 miles rather than work for a large bank tells you how important community banking is to me," said Mr. Williams, who started his banking career at Zions.

Ms. de Guzman writes for the Medill News Service.

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