Tuesday, March 14, 2006

Calendar of Events

Past Weeks, 3/7: Bob Van Vranken – Ballston Spa National Bank: A Community Success Story

This Week, 3/14: Eagle Scout Eric Burgoine & Tim Sinnenberg –

Playground

Next Week, 3/21: Lon Pena – The Water Buffalo Story

Coming Up: 4/11 Tom Lopez – Jack Flanders Adventures

Invocation: George Bailey, Garry Morrow, Dan Stec or Bob Youmans

Suggestions for future programs may be given to Linda LeTendre

• President-Elect Linda LeTendre presided in her own inimitable style at the March 7 meeting and will continue to do so until Rey and Gini Whetten return from their Wyoming vacation.

• Ken Crotty reported that he had an inquiry from a senior editor of Rotary International’s magazine who wanted to talk with club members that might have experienced identity theft. Apparently the editor had read on our website the Rotateller report of a speaker on identity theft and asked Ken to find out if he could interview any of our members whose ID had been stolen. He wanted the interviews for an RI magazine feature on the subject. There were no volunteers. Ken reported that our website has generated over 22,000 “hits” to date from places as far away as Denmark, so it was not surprising to him that RI and many others outside our membership have read our website. Congratulations to Ken on his superb work with the website.

• Sandy Kominoski shared a letter from Sierra Brower’s parents thanking the club for its recent support.

• Steve Caine reported a message from Jerry Smallwood’s son that Jerry had been buried in Pennsylvania and the family was holding a memorial service for him at Immaculate Conception Church on Route 50 on March 11.

• Jennifer Martin, Branch Sales Manager for the Ballston Spa National Bank and a member of the Champlain Canal Rotary Club, was introduced as a guest.

Local David Fends Off Goliath

March 7 speaker Bob VanVranken, local attorney of renown and Chairman of the Board of Directors at the Ballston Spa National Bank, provided an insider’s account of how a large organization (Trustco) tried to “swallow up and destroy” a much smaller one (BSNB).

BSNB was established in 1838 with $25,000 in assets, 5 employees, and 13 directors. 168 years later it has $300 million in assets, 125 employees, 8 branches, and only 8 directors. Bob said BSNB is not public, but it does have 750,000 shares of stock and that’s what Trustco Bank, which has a billion dollars of assets, wanted from a BSNB takeover.

The BSNB Board of Directors unanimously agreed that a Trustco takeover was “not in the best interest of shareholders“. Trustco offered $46 a share to the stockholders, but BSNB felt the stock was valued at $70-75 a share. Trustco said BSNB was a “poor performer”. BSNB disagreed and believed that Trustco would have closed BCNB’s branches, fired employees, and used Trustco’s existing branches as replacements. It felt that Trustco would keep BSNB’s real estate holdings (ie. BSNB owns property in Ballston next to that owned by Walmart) while a community-oriented bank with 168 years of local community service would simply disappear.

The takeover failed because Trustco couldn’t obtain enough tenders from BSNB shareholders to force a change. Bob believes that fewer than 10% of the shareholders had agreed to Trustco’s offer. He said that BSNB’s history as a small, manageable, and community-oriented organization won the day. Bob says BSNB is a community bank “by habit, by practice, and by mission”. Its president knows the names of all its employees and its bank tellers can greet most of their customers by name. Bob asserted that presidents of larger banks, like Trustco, whose merger experience causes periodic name changes and personnel turnover cannot aspire to this kind of human touch.

Bob VanVranken emphatically observed more than once in his remarks that “small is beautiful”. In addition to speaking of the contrasts between big and small banks, Bob also drew a comparison between the community-based Burnt Hills Hardware and Walmart in support of his premise that community trust built on service to the community and an individual’s personal experience is the advantage that enables small enterprises to compete successfully with larger organizations. And that’s why David beat Goliath in your hometown.

Reported by Dick O’Rourke