Thinking strategically propels Salem bank

By NANCY MADES
Special to Essex County Newspapers

"There is a culture of innovation that I think is unique to our institution," says Hall, who joined Salem Five three years ago after a 27-year career with Shawmut Bank.

"We're not afraid to explore new options. A lot of banks wait for other banks to lead the way. Salem Five prefers to be a leader and is willing to be a pioneer."

A willingness to explore new banking territory has put Salem Five at the forefront of Internet banking, says Hall, who lives in Beverly with his wife, Nancy, and their two children. "We were the first bank in New England to have a bank web site and the first to offer personal computer banking to our customers.

"Early on, the bank identified the Internet as a future delivery channel and was willing to make the investment, get involved and try to figure out how best to provide those services," says Hall.

Salem Five's web site is nationally recognized and was recently ranked sixth in the nation by Gomez Advisors, a consulting group that monitors Internet banking. The web site has also been praised in numerous business journals.

Another new venue for Salem Five is the insurance industry. The bank was recently issued a license to sell insurance. It's the first chartered bank in Massachusetts to receive such a license. Federal and state laws traditionally restricted banks from the insurance industry, but recent changes in those laws changed those rules.

"We saw an opportunity and were the first to throw our hat into the ring. Now we're actively involved in the sale of insurance," Hall says. "We've only been up and running for a few months, but we feel confident that this is another area in which we'll be able to provide services to our customers.

"I think one of our greatest strengths is a consistent focus on high-quality services to consumers and business customers. It's really an over-arching quality of the bank, the commitment to quality service," says Hall.

The secret of Salem Five's success for more than 150 years is that it's been "strategically managed," says Hall, who earned a bachelor's degree from Norwich University, an MBA from Babson College and attended the Harvard Business School.

"The company consistently looks at where we are and where we need to be to provide for our customers."

That strategic management has paid off, resulting in the bank's tripling the size of its commercial loan portfolio since 1996.

"Small businesses are the fastest-growing segment of the economy, both nationally and locally. Most large companies are downsizing, leading to a plethora of small businesses popping up all across the country," he says. "That trend is reflected here on the North Shore. We've got a particularly good economy resulting in lots of start-up businesses and growth of established companies. It's a great market here on the North Shore."

Established in 1855 as the "Nickel Bank" because its first deposits ranged from five cents upward, Salem Five has continued to foster loyalty in its clients by being an active supporter and partner in the communities it serves, says Hall, who was born in Pennsylvania but grew up in Lynn and Hamilton.

Following the Great Fire of 1914, which destroyed much of Salem, the bank played a pivotal role in rebuilding the city.

During the 1970s and `80s, the bank was instrumental in financing the revitalization and redevelopment projects that resulted in the downtown tourist attractions, Pickering Wharf recreational area and the National Park Service's Salem Maritime National Historical Site.

In the 1990s, Salem Five's investment in the Community Reinvestment Act helped create affordable housing in Salem.

"People recognize and appreciate banks that give back to their communities, and Salem Five has a proud tradition of giving back to the cities and towns that we serve," Hall says. "Our officers are active volunteers in the community, and we make many direct contributions to nonprofits and other charitable institutions.

"That's what community banking is all about," says Hall, "being an institution of, by and about the community."