My bank sent me an email telling me it was further shortening its branch hours. It already had sent one that said the branch lobbies were closed, and only the drive-through windows would be open. The rationale was:
"to promote social distancing requirements and help support the health of our associates, our clients and our communities."
The reason, at least here in New Mexico, was that the bank was already losing business before the pandemic, and this provided a convenient cover for reducing services.
One of the most important consequences of the economic problems of 2008 was Española lost its local bank. Whatever one might think about their owners, local banks are more likely to loan to local businesses because their appraisers know the community. They also may be a bit more tolerant of late payments because they realize they gain nothing when businesses close.
Outside bank owners have no such provincial interests. They only care about revenue.
I’ve noticed in the past few years, fewer people are opening businesses and they’re failing sooner. I don’t know if this is a consequence of the market, or if the banks are providing money to fewer people for shorter periods of time. It may be both.
Anyway, I changed to the local bank in Santa Fé. My accountant tells me they were in even more serious trouble than our local bank in 2008. I believe he has access to gossip I don’t and so I take his word, though I won’t quote him directly.
The bank changed hands last year. As part of the transfer, the Santa Fé bank sold all its mortgages. One of the reasons people used it, despite problems, was it never sold its loans.
I know the one bank had poor data processing systems, and it appears the new ones were even worse. I didn’t get two of the required reports I needed to submit my taxes. The new bank’s system didn’t use by PO box. It saw a physical address and combined it with the county to send the form to the town of Rio Arriba, New Mexico.
The other problem was worse. It had deducted taxes from my mandatory IRA withdrawal, but had not reported that money to the IRS. That took a day to straighten out since the bank had to file a correction with the federal government.
Bad word of mouth is deadly for businesses. My accountant told me that, of his customers, I was one of the few that hadn’t changed banks. My massage therapist repeated more horror stories he had heard.
When I went to my usual branch to get the missing tax papers, few cars were in the parking lot and almost no one entered the lobby. I wouldn’t be surprised if the bank doesn’t use the coronavirus to close some branches, and permanently eliminate those jobs that temporarily are suspended.
No comments:
Post a Comment