Vernon Hill, the chairman of Commerce Bancorp in Cherry Hill, N.J., says some of its bigger competitors are "the gift that keeps on giving."

By this he means, of course, that some of their policies almost drive customers into his lobbies for relief.

What motivates people to change banks? In asking this question whenever possible, I have come up with some specifics that illustrate an old saying: "If I can do nothing else, I can always serve as a horrible example."

Undoubtedly the most important mistake that banks can make in serving a community is to move people around so frequently that customers no longer recognize any faces. The owner of our local auto repair shop told me: "I walked into the bank where I have kept my account for 47 years and had to identify myself. No one knew who I was."

He added that he finally got fed up and moved to a community bank that had just come to town, the bank gave him a completely free personal account for being over 50.

The next day, I went into his former bank, where I also have been banking for over 30 years, and recognized only one face of the 30 or so people working there: the lady in the bullpen where you get directed when you come into the bank.

I asked after an employee whose daughter I had helped get into Rutgers a few years back; I have always enjoyed following up to see how her girl has been doing since graduation.

"What happened to Mrs. X?" I asked.

"Oh, she transferred to another location," was the reply.

My thought was that a teller who has been in the branch for close to a decade is a valuable asset, if for no other reason than that people recognize her and like to wave hello. Shouldn't a bank realize this? Couldn't the bank have a salary structure that gives a bonus for people willing to stay in the same branch for a long time, providing a familiar face for customers?

Another relevant experience: I was talking to a businessman whose account had been at a major bank that absorbed another major bank in his region. As part of the megamerger they were required to spin off a large number of offices and their accounts, so they sold them to a new entrant into the area.

"I realized how smart the merged bank was in picking which organization to sell the offices to," he said. "They were no competition at all. Within three months I had had enough and moved to another office of my former bank that had not been sold."

"What did they do wrong?" I asked

"Well, here is the best example: When I deposited local checks, it would take five days before I was given good funds. That was enough for me."

Another example of how large banks can give this gift that keeps on giving came from a banker I met at a conference who had been at a community bank that was absorbed by another of these large regionals.

"They let me go, " he said, "because the types of loans I was making were for $25,000 or $50,000. They said they didn't want to bother with any loans under $250,000 or even with the deposits they drew in. Their reasoning was that it took the same amount of work to service a $250,000 loan as a smaller one, so why bother with the latter."

I have always found that the three things people want most from a bank are these: quick and satisfactory correction of errors; fast response to loan requests; and someone who knows us by name and makes us feel we are welcome in the bank.

Pretty simple, don't you think?

Mr. Nadler, an American Banker contributing editor, is professor of finance at Rutgers University Graduate School of Management.

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