President Bank of Southside, Carson, Va.

Peter Clements may run a small-town shop, but he's proven that he can bank with the big boys -- even his father.

Mr. Clements, 35, was recently promoted to president of the Bank of Southside in Carson, Va. (population 200). His 62-year-old father, who is widely hailed as one of the nation's premier community bankers, is chairman and chief executive.

With a 2% return on assets annually, Bank of Southside is one of the most profitable community banks. Its success, Mr. Clements says, is rooted in a profit-conscious mind-set as well as a willingness to take on industry taboos.

"We don't do things like they were done 10 years ago because they worked then," he says.

Adds Leeton Harding of the Virginia Bankers Association, "They are committed to a philosophy of community banking, but try to marry that with the technology, learning, and foresight you might expect in a much larger institution.

When Mr. Clements gets together with folks from larger banks, his guests furiously take notes on the latest ventures of $186 million-asset Bank of Southside.

He tells them about the hightech electronic systems his nine-branch outfit has installed, and he describes how cost effective his optical-disk storage system has been (his bank was among the first in the country to set one up in 1988).

Mr. Clements also explains the debt cancellation contract he is starting and the new debit card his customers are raving about, even though the bank has no ATM. No one has yet convinced him that the machines are profitable, he says.

Mr. Clements was born and raised in Carson. After earning an MBA from the College of William and Mary and then working at Wachovia Bank and Trust in North Carolina, he returned to Carson to join his father's bank.

"It's a double-edged sword, he says. "Now when we get together my wife and my mother almost automatically know we're going to lapse into those conversations about the bank. But I think I'm working with one of the best bankers in the business. "

Mr. Clements sees his new position as an exciting but humbling opportunity. The challenges ahead are to maintain small-bank service, he says, but break new ground with innovative products that reap profits for both his customers and his bank.

"If you get cocky, you're in trouble," Mr. Clements says. "Fat, dumb, and happy is no way to control your life. "

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