Donald L. Peltier, chairman of ArgentBank in Louisiana, had the vision to want everything done exactly right.
He realized that only quality of service and total commitment by each and every employee would bring the performance and results he was looking for.
With Randall E. Howard, president and chief executive officer, Mr. Peltier built a successful super community bank, known until June as First Interstate of Southern Louisiana.
The company, approaching $600 million of assets, weathered 10 recessionary years in its market without a single annual loss. While many other Louisiana banks were suffering or even perishing, ArgentBank earned 1.35% on assets and 15.7% on equity last year, with a 9% capital ratio. It has sustained that performance into 1993 so far.
The secret of success at ArgentBank -- which changed its name because it withdrew from the First Interstate Bancorp franchise system -- is investment in people.
First, the bank pays well. "We compare ourselves to the best-run banks in the country and pay our people accordingly," Mr. Howard said.
The benchmark banks for salary administration are strong performers and not necessarily in ArgentBank's marketplace.
"You have to pay well to attract the best," Mr. Peltier said.
The bank has given employees the option of retiring at 62, with retirement benefits reduced by only $40 a month from what they would be at age 65.
Clearly, management is attentive to employees, realizing they are the company's most important resource. Time is invested in the people, as well as money.
During a postmerger integration program, Mr. Howard scheduled breakfasts to meet with every single employee of the newly acquired bank. The practice has evolved into a series of breakfasts with 15 to 20 employees every other month.
As a result, the bank president meets at least once with everyone over an 18-month period. Mr. Howard's degree of accessibility is unique, and his employees indicate they have no fears in dealing with him openly and honestly.
Accompanying the strong bottom line is low employee turnover. More than 30% have been with ArgentBank 10 years or more.
Staff retention is especially critical for super community banks. The employee-customer relationship is key to being attentive to customers and their local marketplaces, which differentiates super community institutions from more distant, impersonal bureaucracies.
Studies have shown that the longer employees stay with a bank, the stronger customer loyalty is. And customer retention gets translated into improved profitability, since customers over time will use more products and services and end up paying more in interest and fees.