President pulls Ipswich bank back from the brink

By JILL HARMACINSKI
Essex County Newspapers

"I think the biggest thing is going to be the Internet and how that continues to affect businesses," said Grey, who has worked at the bank for the past 13 years.

Grey admits the Ipswich Savings Bank, whose name has been streamlined to the IpswichBank, wasn't the first financial institution to jump into cyberspace. But IpswichBank intends to be aggressive with its Internet marketing dollars.

"We definitely will," Grey said. "There's a huge demand, and it's so much more convenient for people to use."

In downtown Ipswich, the bank now has a storefront geared specifically at courting and capturing Internet customers.

Grey said the bank is picking up 5 percent of its customer base through the Internet. This year, paying attention to the rapid changes in technology as well as the needs of customers is going to be even more important for this community-oriented bank to thrive.

"The speed at which the world is changing has increased. All businesses have to keep up with that pace if they are going to survive," Grey said.

This from a man who said he landed in the banking industry by mistake.

As a Northeastern University student, Grey, an economics major, got a cooperative job as a bank examiner. By 1980, he was head auditor for Guaranty First Trust of Waltham. After a year, he jumped to Vacation Properties in Boston, where he co-owned a real estate marketing firm.

By 1982, however, he was back to banking. After four years as vice president of First Colonial Bank in Lynn, Grey walked through the front doors of the Ipswich Savings Bank where he would become president and chief executive officer in 1992.

In the early 1990s, the bank _ rocked by scandal, more than $5 million in debt and stuck with bad real estate loans _ clearly needed a miracle.

In 1989, the bank had lost $2.5 million followed by another $3 million in 1990. The $5.5 million loss equaled nearly a tenth of the bank's total assets.

The losses were triggered by a series of bad loans, which led to the bank's president pleading guilty to five counts of banking fraud.

In 1992, Grey, then serving as chief financial officer, was appointed bank president. One of his first orders of business was an attempt to sell some of the bank's problem assets.

But one large development, the Ipswich Country Club, remained under the bank's control. As the developer, the bank would oversee the entity's completion many years later.

In a 1996 interview, Grey noted it was a risky but proactive response to a tremendous problem.

By 1997, the banking world was marveling as Ipswich Savings Bank, nestled in a community of approximately 6,000, touted stock prices at $23.50 per share.

Economic experts said at the time that stock price was an indicator of powerful earnings, dividend increases, management expertise and ultimately, evidence a takeover may come in the near future.

Today, Grey is tight-lipped when asked about a possible merger. "We really don't like to comment on those things," Grey said.

So is a merger ruled out?

"We really never rule anything out. In business, you have to be flexible," he said.

One thing Grey is commenting on is IpswichBank's expansion. In addition to Ipswich, the bank has branches in Essex, Rowley, Beverly, Marblehead, Salem, North Andover and Reading.

As the century turns, IpswichBank will continue to focus on another of its trademark successes, the IpswichBank Educational Foundation. The foundation provides financial support for education, such as cultural events, field trips, art supplies or textbooks, "in any of the schools or towns that house our eight branches," he said.

The major fundraiser is a golf tournament held annually at the Georgetown Country Club. To date, the foundation has raised $60,000.

"And we are certainly very proud of that," Grey said.

"I never thought I'd be running a bank. But running a community bank, which Ipswich is, is very rewarding," Grey said. "Ipswich has been fantastic for me."