A former community banker running for Illinois treasurer has pledged to put more of the state's money in community banks - but he has also made a pledge not to take campaign contributions from banks.
Alexi Giannoulias, a Democrat, is a former vice president and senior loan officer at the $911 million-asset Broadway Bank in Chicago. In a talk Sept. 9 at a local political group's meeting, he said his time as a banker gives him the experience to manage the state's finances. But if his career as a banker has played a key role in shaping his political platform, it has also put him on the defensive.
Broadway Bank, which Mr. Giannoulias' father founded in 1979, has been ranked as the top-performing Illinois bank by return on assets by Crain's Chicago Business each of the past four years. According to Federal Deposit Insurance Corp. statistics, Broadway had an average return of 4.71% from 2002 to 2005, while the average for all Illinois banks was 1.02%.
"The state treasurer is the state's banker, whose responsibility is to invest the people's money and get the highest rate of return," Mr. Giannoulias said in an interview last week. He said he also wants to promote community development by depositing money in banks in underserved areas, so that they have more money to lend.
"You have to look long-term and develop communities around Illinois," Mr. Giannoulias said.
He also said he wants the state to fund individual development accounts that would encourage poor people to save by offering them financial education and matching money on the deposits they make.
Though he has pledged to work with banks, he said he would not accept campaign donations from them, or from any contractors that work with the treasurer's office.
He said he felt the need to make that pledge because Illinois voters are upset with recent ethics scandals. This month George Ryan was sentenced to six-and-a-half years in prison on racketeering charges stemming from his time as the state's governor.
"People think that everybody is dirty," Mr. Giannoulias said at the meeting. And he himself has been accused of being ethically challenged. In an article in March before the primary election, a Crain's columnist said that voters should take into account the fact that Broadway made loans to a borrower who previously had been convicted of running brothels and bookmaking, and that it had financed property for a gun store that was sued by the City of Chicago.
Neither the bank nor its employees has been charged with any wrongdoing in connection with the loans, and the column seemed to have little influence on voters. Mr. Giannoulias, 30, won the primary with 63% of the vote - even though he was not the Democratic Party's slated candidate.
He left his job at Broadway in May to focus on his campaign. He would not discuss the specifics of the loans cited in the column, but he said Broadway does not violate any ethics or laws when it makes its loans.
"Banks make loans based on the creditworthiness of the borrower, the commercial viability of the loan, the value of the collateral, and whether they think the loan will be repaid," Mr. Giannoulias said.
Neither the Illinois Bankers Association nor the Community Bankers Association of Illinois has endorsed Mr. Giannoulias or his Republican rival, Christine Radogno.
