'Occupy Evanston' gets ear of aldermen on banks

Diane Thodos

Evanston aldermen voted Monday to take a fresh look at where the city parks its money, after months of efforts by a handful of "Occupy Evanston" activists to persuade the city to stop dealing with Chase Bank.

Diane Thodos, of 2668 Orrington Ave., and other activists say that Chase and other big banks should be punished for their role in creating the banking crisis that triggered the recent economic recession.
Thodos said the city should be putting its money only in local banks instead.
Depending on how local is defined, that could leave the city with little choice about where to place its funds, since only one bank, First Bank & Trust, is actually based in Evanston.
The city currently splits its banking needs between First Bank and Chase and, Assistant City Manager Marty Lyons says, typically has a total of about $75 million on deposit in dozens of different accounts.
FDIC data from 2010 showed Chase had the largest share of total deposits from all Evanston residents, not just the city, at 39 percent, with First Bank second at 26 percent.
The city has used those two banks for over 10 years, Lyons says. It started to re-evaluate its banking relationships in 2008, but dropped the request for proposals process then because of the unstable economic environment.
In the new RFP, the city focuses mainly on a variety of technical service issues, but it also will ask the banks about their rating under the federal Community Reinvestment Act, whether they've been fined by banking regulators, the number of mortgage foreclosures on their books and the scope of their banking activities in Evanston.
Top: Diane Thodos, addressing aldermen during Citizen Comment Monday night.
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Winners and losers among Evanston banks

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Comments

Goodness

Here's an idea - put the money in the most sound bank that will have federal backing if another banking crisis hits. The locally headquartered bank is probably great, but if it is on the cusp of going under, the feds will shut it down and only those with deposits below the insurance limits will be made whole. The feds simply will not let JPMorgan or BAC or Citibank go under because it would wipe out too many other businesses who retain deposit and working capital accounts in them, so let's piggyback on that implicit guarantee and not gamble on a small bank with the local taxpayers' money.

'Occupy' and banks

I find it odd that so many people complain about the banks and what they can do but ignore what they CAN do daily.
They complain about the salaries of bank executives and others and the transaction costs. But everytime they use a debit or credit card the merchant pays a fee which then goes to the bank and the detested executives.
Of course the merchant has to make up the fee cost so they have to raise prices.
But daily I see students [who say they do care since the merchant pays not them---no Econ.101 yet I guess] and adults who should know better using debit/credit cards for purchases under $5. 
Last I knew fast food and grocery stores operate on a 1% profit margin and so these charge/debits may wipe-out any profit or even put them in the hole.
But then speeches and marches are more fun then actually taking steps.

Thank you anonymous ... what

Thank you anonymous ... what is the City of Evanston's plan if First Bank were to fail and it was wiped out on the $75mln, less any FDIC insurance that exists.  We should support First Bank but probably not concentrate every account within it.

Keep Our Money In Local Banks!

As a customer of First Bank and Trust of Evanston I believe that they are a top notch institution. When I moved here I was looking for a bank. I went to Bauer Financial to find a bank IN Evanston that was local and highly rated. I found First Bank and Trust at 5 Stars. That was five or six years ago and I just looked at their rating and they are still at 5 Stars. They have a great staff and provide great service and I think we should keep our funds in a local bank, why should we enrich other communities with our funds? Obviously this global economics is not working out too well.

2 sides

To Marty Lyons, to help you address their scope of activities locally, I would like to thank Chase bank for supporting my business here over the last couple decades.  They have funded me, helped me expand, helped lowered my cost, made sure I can meet cashflow for the payroll of my 60+ local employees.  They have done nothing but an outstanding job and partly because of them, their advice and assistance, we are profitable and can continue to donate to the many local charities we support and before I forget, pay the very substantial commercial rate r.e. taxes we, and they, pay.
Absolutely nothing wrong with the Evanston First, excellent bank, excellent people.  Hopefully we will make decisions based on more than the superficial soundbites from a handful of OWS activist.    

Broadway Bank, Chicago, IL

Maybe the City should put their money in Alexander "Alexi" Giannoulias's local bank, Broadway Bank?  Remember him?  Our former Democratic State Treasurer.  Hmmm wait a minute Broadway Bank is belly up!
I'm not sure if Diane Thodos realizes that JP Morgan was mandated to take TARP and did not have to receive any federal money.  Ironicly they were one of the banks that was above water when the banking crisis hit. 
 

A billion

Chase also paid back, in full, that mandated tarp in 2009 and paid the taxpayers dividends for a profit of close to one billion dollars.   

Financial Mess and Banks

Stop blaming everyone except the true enablers.  The death of Glass-Stegall was arranged by Clinton negotiating a quota on mortgages for low income buyers. Add to that Frank and Dodd enabling Fannie & Freddie to buy those mortgages to goose their bonuses, leaving the issuing banks free of loss, and you had a perfect storm.
Castigate the enablers.