Gulf Coast banks used lessons learned from Hurricane Katrina in 2005 to improve how they deal with disasters. Fast forward seven years, and Hurricane Isaac is putting those plans to the test.

Isaac was a category 1 hurricane when it made landfall Wednesday, becoming the first major storm to batter New Orleans since Katrina. The storm's damage is expected to pale into comparison to Katrina, which ravaged coastal cities and led to pandemonium in the Big Easy.

Still, area banks were not taking Isaac for granted. Bankers pride themselves on their banks serving as a lifeline to cities and town; disasters are a good way to demonstrate that ideal.

"It is not an event they wish or seek out, but disasters create an opportunity to demonstrate their commitment and ability," says Steve Reider, the president of Birmingham, Ala., consulting firm Bancography. "When the bank is back open for business it a sign that the community is open and has survived."

Bankers along the Gulf Coast say that the best way to serve customers after a storm involves being stocked with lots of cash since widespread power outages render credit and debit cards useless.

"It becomes a cash society very quickly after a storm," says Rusty Cloutier, the president and chief executive of MidSouth Bancorp (MSL) in Lafayette, La.

MidSouth stores $1 million in extra cash for hurricanes. In 2005, Cloutier had to take extraordinary measures after his $1.4 billion-asset bank's branches in Louisiana were slammed by Hurricane Katrina. MidSouth's Texas offices were hit by Hurricane Rita a few weeks later.

"It sucked up all the cash we had, so ... one day I put $500,000 in a duffel bag and drove it to Beaumont" in Texas, Cloutier says. "I got to a National Guard check point and told them I had the cash and was there to deliver to pay the public workers. They looked at me like I was kidding, but then they gave me an escort. You do what you got to do to take care of your customers."

Cloutier adds that he also brought snacks and sodas alongside the cash. "I think some people were happier to see the food and the Cokes," he says.

Carl Chaney, the co-chief executive and president of Hancock Holding (HBHC) in Gulfport, Miss., also became a courier during Katrina. Chaney even helped out another bank, he said in an interview earlier this year.

"I got a call [from a driver] on the satellite phone and they said we will make one stop and that's it," Chaney said. "So they set a designated place where we would meet and on my way to meet the courier I got a call from another community bank. He said, "We are running out of cash and we've got a line out the lobby'," Chaney said. "I said, 'Meet me at this intersection'."

Hancock also washed, dried and ironed cash that was stored in underground vaults that had flooded, says Shane Loper, the company's chief risk officer. "We ironed millions of dollars and got them back into circulation," he says.

Hancock's disaster plan now calls for extra cash and fuel trucks to be ready to serve cash vendors who might be worried about getting stranded. Employees are also able to use the trucks, Loper says.

A representative for the Federal Reserve Board said the central bank keeps a stash of extra cash at its branches for emergencies. The Fed has also extended dock hours in New Orleans and Jacksonville, Fla., to accommodate any increased demand.

In addition to cash, several Gulf Coast banks have opened satellite command centers. Hancock built a data center in central Alabama. MidSouth has call centers in Dallas and Houston and a data center in Missouri.

Though First NBC Bank in New Orleans opened a year after Katrina, its leaders still learned lessons from other banks. Ashton Ryan, First NBC's president, says Katrina prompted the bank to open a data storage site in Birmingham soon after opening. The center has evolved into command post. Earlier this week, Ryan sent roughly 20 employees to the center run the bank's operations.

"We went live out of Birmingham on Tuesday," Ryan says. "Why did everyone start doing this? Katrina. Banks were devastated and when we looked at the investment it required, it was too cheap not to do it."

Rachel Witkowski contributed to this article.

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