As interstate banking expands, attitude and focus will be more important than geography.
For an example, look at National Westminster Bank's financial markets group in Jersey City.
Sure, Natwest - a worldwide banking giant based in London - has nearly 1,000 capital market specialists in New York City. But right across the Hudson River, high in a Jersey City skyscraper with a breathtaking view of New York, are another 250 professionals with their own trading floor and sophisticated equipment that must be duplicated a mile or so away in the Big Apple.
"Why do you need Natwest financial markets group?" I asked Hugh Chairnoff, executive vice president and treasurer of Natwest Bank and head of the group.
"Our entire focus is different," he explained. "We serve people whom any New York transaction-oriented office wouldn't touch, as they would deem them too small.
"We make these customers' business relationships profitable."
The Natwest group prides itself on doing more than providing investment and foreign exchange services, asset-liability management solutions, and municipal advisory and finance services. Here the idea is helping correspondent community banks anywhere in bringing capital markets skills and tools to their communities and customers.
When you visit Natwest's trading floor, far and away the largest in New Jersey, it becomes clear that geography means little.
Sure, many of the staff are old New York finance pros who came to Jersey City with the bank when it opened here. In an era of downsizing and job insecurity, a mile-wide river is no barrier to the movement of talent.
And as Mr. Chairnoff described the competition, time after time the name First Union Bank in Charlotte, N.C., came up.
That's not just because First Union is completing the acquisition of First Fidelity, New Jersey's largest bank. It is also because it has a similar focus in its capital markets group.
And Mr. Chairnoff is not so complacent as to feel that a home-office distance of 800 miles or so is going to make a difference in competing for New Jersey business - not in a world when contacts are made by phone and fax.
When a rep does show up, no one cares whether it is from an office next door or half a nation away.
Community banks would do well to emulate Natwest's emphasis on service, as well as its awareness that geography is no barrier to intrusive competition.
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If your bank sends out its dividends dated Dec. 31, why not switch to Jan. 1 or 2?
It makes no real difference to the bank, but it does to shareholders. They can postpone taxes on the winter check by a full year.
To a shareholder receiving, say, $1,000 a quarter and in the 40% tax bracket, this means a delay of one year on sending $400 to the IRS. At 6%, that's an increased return of $24 - at no cost to the bank.
Mr. Nadler is a contributing editor of the American Banker and professor of finance at the Rutgers University Graduate School of Management.