Today's example comes from Sanders National Bank ($233mm, ND) who came up with the innovative idea of renting out their back 100 sq foot storage room to a local college student, Ed Polaski.
Bank CEO, Charles Kumbridge got the student after posting a classified ad on Craigslist.com that offered the storage room, access to the break room after hours and a shared public restroom all for $575/month. The ad was answered in less than a day after the bank offered "a unique living experience for a responsible non-smoker with no pets." After a brief interview with the bank's CEO and CFO, Polaski was granted the space and moved in 10 days later.
Other than a brief incident that occurred when Polaski walked out in the lobby in his boxer shorts (after daylight savings time) on a Monday and another time when he forgot and parked his car in the drive thru while the bank was still operating, bank personnel have had nothing but positive things to say about taking on "roommates" in order to defray costs and produce additional fee income. CEO Kumbridge admits that because he didn't take TARP funds, the bank had to get creative in coming up with ways to protect capital. According to Kumbridge, "While our arrangement is unique among banks, it is something that every financial institution should consider." He added, "Ed has been a total plus. He not only helps restock our deposit slips after hours, but we have signed up half his friends and family to depository accounts. Last Saturday, Ed gave an NCAA BBQ party out back and we ended up opening 12 accounts."
Even more positive is Mr. Polaski's take on living in a bank. The cheap rent, a quiet neighborhood, extra security and unlimited access to the Jolly Rancher's in the lobby bowl are all positives. "This is a unique experience that isn't for everyone, but for me it's perfect," said Ed. He went on to rave, "While banks have a lot of bad press, Sanders National is like home. It's totally cool living here and hanging out in the vault is really cool."
While we were certain there were regulatory requirements against non-bank personnel living in a branch, we were amazed to find out that there are no prohibitions. Sanders National has yet to go through a safety and soundness examination, but from what we have seen and read, we are pretty sure that most regulators wouldn't check for this sort of thing.
Taking on a bank roommate is unique and underscores how some banks are dealing with the current environment. If nothing else, the idea may be a worthy April Fools joke. Have a good one and watch your back today - fools are everywhere.