Community Banks

THE FEDERAL Deposit Insurance Corp.'s definition of a community bank is a bank with assets, or deposits, of $1 billion or less.

Some Bay Area community banks have higher assets, like The Mechanics Bank ($2.6 billion) and Fremont Bank ($1.7 billion).

But most community banks have far smaller assets.

For instance, one of the several professional organizations in the industry, America's Community Bankers, reports that most of its members average $180 million in assets.

However, it is not the asset size but the kind of service that distinguishes a community bank.

Community banks "give more personalized service, more human scale service. We are part of the community. We incubate small businesses and do agricultural lending," said Bill Grassano, spokesman for Independent Community Bankers of America.

Other people say a community bank is interchangeable with the term independent bank, not owned by a larger institution. And its decision-making is done at the local level, primarily in making loans.

These institutions are a fluid lot, opening, shutting and being merged. Since 2004, nine have opened and 15 have closed in the Bay Area. Four new ones have been proposed.

Western Independent Bankers President and Chief Executive Officer Nancy Sheppard called community banking in the Bay Area "an eclectic group of lenders serving different needs of different people."

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