* * Tommy Loflin lauds community banks

Those of us in the bifocal set remember longingly the shops, stores, and banks on Main Street that formed the economic backbone of our small towns. Chances are, the drug store, the furniture store, the record store, the car dealership, and even the bank were owned by the parents of our classmates. Even in the chain stores, the clerk who waited on you typically was somebody you know who worked there seemingly forever. This memory sparked a conversation with banker Tommy Loflin, who recently helped me secure a loan to enhance my business.

“I’m from Rustburg,” Tommy said. “It is a tiny town, without a single traffic light, only a caution light. It’s south of Lynchburg, where we shopped. Downtown Lynchburg was thriving.”

Tommy came here to go to Tech and is now the Market President at NewRiver Bank, a new bank that formed after First National Bank, a local bank with a long history in Christiansburg, was merged into a larger bank. Several members of the Bank’s board were unhappy with the merger, unhappy enough to form their own bank, which was eventually folded into Roanoke-based HomeTown Bank.

“Banking has gotten more complicated from a regulatory standpoint. In the old days, whenever that was, when you knew customers well, you knew their financials and you knew their character you could make a decision quickly. That applies to some degree today, but there are more required analytics. When you make a loan on real estate, you still need to get an appraisal and title work. But customers can still call me on my cell phone at home on a Saturday, tell me what they need the money for, and if, because of our personal relationship, I know that it’s a good deal, we can come to terms.

“We started in 2008 as a result of First National selling out. HomeTown Bank started in 2005, so they were a young bank when our bank organized to join them.”

Tommy explained that some of the people affiliated with FNB who were unhappy about the proposed sell-out, from customers to employees to members of the board of directors. Several directors fought an unsuccessful proxy fight to prevent the sell-out. Once it happened, they decided to form a new bank that would stay local.

According to Tommy, these directors felt that, “FNB was such a great contributor, such an asset to the community, at least in their eyes, and their fear was that in the sell-out the local control would be lost. The local directors’ input would be watered down. It wouldn’t be Montgomery County people running the bank. I was against it, too. I left FNB as soon as the sell-out happened. I don’t think there was any positive financial gain from these folks fighting the sell-out or starting something new. I really think their hearts were in the right place fighting the fight.”

Since then, what was FNB is now part of a much larger, regional bank.

“My definition of a community bank is one where the powers that be, primarily the directors, are entrenched in the community and care about the community and make decisions because their kids go to school there, they run their businesses there, and they pay their taxes there. The loans are mostly kept in the community. The paychecks and profits are spent in the community.

“We concentrate on our neck of the woods, meaning the New River Valley. A local person may have a core business here but need money for a facility elsewhere, and in that case we’d help them. But most of our customers are within 30 miles.”

Tommy said he was not only a proponent of local banks, but of all local businesses. “It’s healthier for small, rural communities to have local what-evers: drug stores, farmers, everything.

“My suggestion to folks is that even if they only have a checking account and a savings account and perhaps a car loan, get to know our branch manager. Let them get to know you. When something comes up or if there’s a problem with your account, there will be a face with that phone call. It’s more personalized. Personal service is what allows community banks to survive and thrive. We have an automated system for after-hours calls, but during regular hours, everybody is responsible for taking calls. I put in lots of hours and sometimes take home work. My kids are grown, I have the time, and it’s fun for me. I’m doing this for reasons beyond money. It will take years and years for this bank to have the reach and influence that FNB had in this community. But we’re working on it; it’s the right thing to do.”