Classroom to Boardroom
Melby, Todd, Independent Banker
Teenagers get schooled on the business of banking
Walk through the glass doors at this East Penn Bank branch at noon and there are customers queuing up at teller lines and opening accounts at nearby desks. Clients are depositing checks, withdrawing funds and inquiring about account balances.
But just outside the bank doors is a hallway filled with metal lockers and lively teenagers toting backpacks and iPods. That's because this branch isn't tucked inside a mall, a grocery store or even a Wal-Mart.
Rather, it's inside Emmaus High School, the home of the Hornets sports teams and 2,548 ninththrough twelfth-graders.
"A lot of people are surprised when they first come in," says Judy Miller, East Penn Bank branch manager at Emmaus High School. "They don't expect a full-service branch. We have everything all the other branches do, except safe deposit boxes." Customers can get those at the bank's seven other locations.
With an aim towards serving the Lehigh Valley area, surrounding the former industrial cities of Allentown and Bethlehem, just north of Philadelphia, East Penn Bank opened as a de novo in 1991. Fifteen years later, it's grown to $404 million in assets.
"We've experienced double-digit growth every year of our existence," says Debra Peters, East Penn Bank executive vice president.
Like most community banks, East Penn Bank serves both a mix of business and retail clients. Despite a legal lending limit of $5 million, about 55 percent of its loan portfolio is commercial. Residential mortgages (later sold in the secondary market) comprise 20 percent of the bank's loan portfolio and loans to retail customers (home equity, car and personal) make up another 25 percent.
The competitive climate in Lehigh Valley is stiff, Peters says. Bank of America, Wachovia Bank and Sovereign Bank all have a major presence in eastern Pennsylvania. So how is a small bank supposed to stand out in this crowded marketplace?
"Community banks need to pursue a different strategy," says Chris Gill, retail banking expert at Dove Consulting in Boston. "That's why they tend to focus on customer service, long-term relationships and personal relationships."
Opening a full-service branch at a local high school allows East Penn Bank to shine a little brighter than its big bank brethren on all three fronts.
"We think the project has been a great success," Peters says. "Not so much from a profitability standpoint, but as a service to the community and a way to generate future customers."
The Next Generation
Since the high school branch opened in 1999, East Penn Bank has been able to hold on to six of every 10 customers. "To me, that's phenomenal, especially when you consider that so many of the kids leave the area to go to school," Peters says.
While attending Emmaus High School, students can enroll in "Intro to Banking" and "Advanced Banking" classes. The advanced class allows teens to get hands-on banking experience. After signing an agreement to not reveal customer account information, students are allowed to wait on customers, count money and open accounts.
A few become motivated and seasoned enough to work as paid staff at East Penn Bank branches or at its operations center. Jill Schutt, a 17-year-old senior, squeezes in all of her classes before 11 a.m. Then it's off to the in-school bank branch, where she works as a teller.
"I took the class to see what it was about," she says. "Now I'm working here."
Alecia Weaver, who is also a 17-year-old senior, completed the banking courses before landing a job as a proof operator last spring. …