Those heads of local banks are sporting gray hair
They control fewer branches and thrive on loyalty. But after 20 to 30 years, they're starting to call it a career.
When banking was deregulated during the early 1980s, experts predicted the demise of small companies such as Harleysville Savings Financial Corp. Instead, Harleysville thrived, and the banks that were supposedly going to drive it out of business were swallowed by gigantic financial institutions.
Change now has come again to the six-branch bank based in Montgomery County's Lower Salford Township. This time, it's generational. Edward J. Molnar, the affable CEO who led the company for 40 years, retired earlier last month and was replaced by Ronald Geib, whom he personally hired in 1976.
"Why stay in one place for 40 years?" Molnar asked in an interview. "The community had a lot to do with it. I probably should be the president of the chamber of commerce."
Molnar chose banking after deciding that his first career choice as an FBI agent wasn't for him. He learned the business through a training school run by a trade association called the American Savings & Loan Institute. He took courses there two nights a week for eight years.
When he got to Harleysville in January 1967, the bank had $3 million and two part-time staffers. Now, it has a staff of more than 100 full- and part-time workers and $760 million. Shareholders also had a good ride, seeing the value of their stock double over the last 10 years.
Molnar, 67, at first kept his office near the lobby of the company's main branch on Main Street. After the bank expanded, Molnar had to move to a nearby administration area.
"As our bank grew, it was impossible for us to continue that way," he said. "I still maintained a strong desire to mingle with our customers."
Molnar has been active in the community for years. In retirement, he will continue coaching the eighth-grade baseball team at Indian Valley Junior High School.
In addition, he is pretty laid-back, as CEOs go.
"I don't think I've ever heard anybody call him Mr. Molnar," said Doug Gifford, chairman of the Lower Salford Township Board of Supervisors.
Longevity is a common trait among community bank executives, some of whom are lending money to their second and third generations of customers.
Replacing a CEO, particularly one who has been around for a long time, is never easy.
"If I am the mainstay for 40, 50 years, my name, my face, becomes the focus of that institution," Frank Pinto, the head of the Pennsylvania Community Bankers Association, said in an interview.
Since 2005, at least four community banks in the Philadelphia area have changed leaders. That trend is expected to continue.
"We are seeing an aging in banking management," said Robert Schmermund, a spokesman for the Washington-based trade group America's Community Bankers. "A lot of people got into the banking business in the 1970s, and now, 25, 30, 35 years later, they are approaching retirement age."
Beneficial Savings Bank chief executive George Nise, who has been with the bank for 36 years, called it a career Jan. 31. He is being replaced by former Commerce Bancorp Inc. executive Gerard Cudhy.
Harleysville's hometown rival, Harleysville National Corp., is looking for a chief executive to replace Gregg Wagner, who departed in September. Interim chief executive Demetra M. Takes has been with the company for 34 years.
Both financial institutions, along with insurer Harleysville Group Inc., were founded by Alvin Alderfer around World War I.
Robert W. White, the chief executive of Abington Community Bancorp Inc., has been CEO since 1994 and a member of the board of directors since 1977. Ambler Savings Bank's CEO, Martin Brown, has been with the bank for at least 30 years. White wasn't available for comment, and Brown declined a request for an interview.
Dick Kuensch, who has been chief executive of Phoenixville Federal Bank & Trust for 28 years, is staying put.
"I'm still having fun," he said in an interview. "I still look forward to coming to work."
But the small towns where these banks got their customers have become sprawling suburbs, which is attracting the larger banks. For example, Bank of America Corp. and PNC Financial Services Group Inc. have branches near Harleysville.
Local banks are betting that their customers will appreciate that they are owned and managed by people in their own communities.
"We're not Charlotte. We're not Pittsburgh," Cudhy said, referring to the hometowns of Bank of America and PNC. "The landscape has changed. When I started 25 years ago, there were 25 national banks in the Philadelphia area. Now, there may be two."