Community Bank Reinvents Itself

Just a few years ago, Community Bank of the Bay was staring bankruptcy in the face. But, thanks to a new president who was able to convince the bank’s board of the many benefits to be reaped by approaching banking from a philanthropic angle, the downtown Oakland lender has regained solid financial footing and implemented unique programs intended to effect positive change both locally and globally.

By Bill Picture  
Published: December, 2007 

In February of 2007, Community Bank of the Bay, recognizing a dearth of available funding for the growing number of green projects being proposed in the Bay Area, announced the launch of the Bay Area Green Fund. Under the first-of-its-kind program, green-minded customers of the bank can now specify that their deposits be channeled to the fund for lending exclusively to local projects that echo their own eco-friendly sentiments.

Everyone’s talking about green this and green that, says bank president Brian Garrett. Now, you can literally put your money where your mouth is.

An avid outdoorsman, Garrett, who was hired in 2002 to remedy the mismanagement that had sent Community Bank of the Bay into a financial tailspin and had the FDIC breathing down the bank’s neck, is a very active member of two major conservation groups. The creation of the Bay Area Green Fund, he says, was a logical next step in his ongoing efforts to preserve the environment.

[The environment] was always something I was very aware of, he says. And I’ve always been an advocate of community-building and doing the right thing.

So, once Community Bank of the Bay was safely out of the red and in a position to try out some new programs, Garrett saw an opportunity to set the institution apart from its competitors by tailoring programs that focus on the betterment of the bank’s host region, yet have a rippling effect felt far outside the Bay Area.

The first such program was the Oakland First Fund. Recognizing the City of Oakland’s rebound potential, Community Bank of the Bay set aside available funding exclusively for individuals and businesses that intended to use the money in Oakland.

You can’t go fishing or anything like that, Garrett jokes. The idea was, ‘How can we be a better member of the community, as individuals and as a bank?’ Any bank can call itself a ‘community bank.’ But, I think, in order to be a community bank, you have to make it a part of your corporate being.

The second program, the Bay Area Green Fund, is just the latest in a series of green-friendly practices at Community Bank of the Bay, where sustainability has become an indelible part of the company culture. Besides an aggressive recycling program and a top-to-bottom green remodel of the bank’s headquarters on Broadway, which will include solar panels and a rooftop lawn that reduces heating/cooling expenses and reduces carbon dioxide in the air, the bank is also offering its commercial clients the option of scanning checks for deposit and submitting them to the bank electronically, saving business customers a resource-consuming trip to the bank.

And that’s just the tip of the iceberg as far as what we can do, Garrett adds.

Once Garrett had secured a thumbs-up for the Bay Area Green Fund from the bank’s board, the next hurdle he encountered was assembling a team to implement it and oversee it. The challenge, according to Garrett, was finding a loan officer able to see beyond credit scores.

There was no such thing as a green loan officer, he says. Loans are traditionally approved or denied based solely on credit scores. And we wanted someone who was also going to take into consideration the scope of the project.

The solution was to look outside the banking industry for someone with a green background. The winning applicant, Phoebe Higgins, is the daughter of environmental attorneys and holds her own green MBA.

She has a passion for green, so she’s able to look at the much bigger picture, Garrett says. If you have a good, well thought-out idea, come to us. We want to work with you.

While the number of requests received for money for green projects remains a modest one, Garrett says that number is increasing steadily. To date, Community Bank of the Bay has funded green projects to the tune of nearly $5 million, a significant portion of which was loaned to startups.

It’s safe to say that many of those startups would not have qualified for loans at a big-name bank. But taking chances is something with which Garrett is very familiar. After all, Community Bank of the Bay is the third bank that Garrett’s problem-solving skills and bank biz know-how have helped keep afloat. He also takes pride in being the one who loaned Debbie Fields, founder of the Mrs. Fields cookie chain, the money to open her first retail location back in the 1980s.

Bay Area Green Fund money is currently being used for projects of varying scales—from helping fund the ambitious green efforts of a local chapter of a huge, nationally-known non-profit to allowing a smaller packaging company to make the switch to compostable materials.

A good idea is a good idea, huge or small, Garrett says. I want Community Bank of the Bay to be a bank with a conscience. I want us to make a difference. And I want to try to be a catalyst for change.

While the business practices of Community Bank of the Bay’s bigger competitors continue to be influenced solely by the bottom line, the focus on community and the environment seems to be catching on at like-size banks. A bank in the North Bay, for instance, recently launched its own version of the Bay Area Green Fund.

Maybe we can embarrass the bigger banks into doing something, Garrett jokes. Wouldn’t that be great! I mean, every little bit helps. But imagine what a huge difference a Bank of America could make if it was to do something like this.