Consolidation has changed everything about Brattleboro’s banking landscape — except for one bank

BRATTLEBORO — The three-block stretch of Main Street between Walnut and Elliot streets has four banks, but it used to be five, and between them they’ve had at least 12 different names.

First Vermont Bank became Banknorth Vermont, which became TD. Burlington Savings became KeyBank. Catamount became Community Bank, which despite the name, is headquartered in Syracuse, New York. Vermont National became Chittenden, People’s United, then M&T Bank, before closing their Main Street location last year .

Then there’s Brattleboro Savings & Loan. At the north end of the downtown strip, BS&L has never changed its name or its ownership in 112 years in Windham County. It is an outlier in an era in which banking has become both more efficient and less personal — and it’s done so, its leaders say, by staying true to its identity.

“The whole value proposition for us is that the products are similar, but the service, and the attention to the community and the community’s needs, is unique,” executive vice president and CFO Tom Martyn said. “We really try to mirror the values of the community.”

BS&L is one of only seven state chartered banks and 11 state chartered credit unions in Vermont, and it operates just four branches, all in Windham County. As of December 2022, it was one of only five mutual banks headquartered in the state, according to data from the Federal Deposit Insurance Corporation . And it’s the only bank chartered in Vermont, and one of just 16 nationwide, to be a certified B Corporation — a designation of high social and environmental impact and accountability.

Mutual banks are similar to credit unions in that they are not publicly traded as traditional banks are — though mutual banks, unlike credit unions, are still for-profit enterprises. Along with BS&L, there were four other mutual banks in Vermont as of December 2022: Bank of Bennington, Northfield Savings, Wells River Savings and Passumpsic Savings.

Meanwhile, publicly traded banks have a responsibility to investors to consider any acquisition offer. In Vermont and across the country, this led long ago to a trend of consolidation.

Aaron Ferenc, deputy commissioner of the banking division of the Department of Financial Regulation, said that Vermont had 59 state chartered banks sometime in the 1920s, but by 1990 that figure was 21 and it’s been hovering around seven since 2008.

“Mergers contribute to customers feeling left out. Sometimes, they’ll look for local alternatives,” Ferenc said, such as BS&L. “There is this desire in a lot of places to have local banking options.”

Martyn said the ownership structure of a mutual bank, its board of directors being appointed indirectly by the bank’s depositors, has allowed it to keep its footprint local while other banks have been bought up by national brands.

“Their fiduciary responsibility really is to the depositors, which are the community,” Martyn said. “So it’s just a whole different mindset. We’re not worried about profits quarter to quarter. We’re worried about sustainability and benefiting both ourselves and the community.”

These markers both reflect and reinforce the commitment BS&L has to Windham County, president and CEO Deb Stephenson said.

Being the only bank in the area where all decisions are made locally is something that depositors recognize, she said.

In Brattleboro, where its neighbors have undergone many of those mergers and now have headquarters in New York, New Jersey and Ohio, BS&L has benefited from being the only one left with the decision makers right there on Main Street.

“To the public, the idea of a hometown bank has gotten rarer and rarer,” said Greg Lesch, executive director of the Brattleboro Area Chamber of Commerce. “That’s part of what makes Brattleboro Savings & Loan so popular, because they put that part of their brand front and center.”

Lesch said that BS&L has long been supportive in the community, including contributing to the repair efforts after a fire devastated Brattleboro’s iconic Brooks House in 2011.

“You can’t go to an event in Brattleboro where they’re giving thanks to people who had supported and not hear Brattleboro Savings & Loan mentioned,” Lesch said. “You just can’t. They’re everywhere.”

Beyond financially supporting local non-profits and events, BS&L, like many other mutual banks and even some larger banks, emphasizes a culture of volunteerism, including one day every year where they close their branches to send all staff out to “walk the walk” — participate in on-the-ground volunteering efforts around the community.

Those efforts help towards keeping the bank’s B Corp certification, a stamp that reflects pre-existing values more than motivates the bank to change its priorities, according to Martyn.

“When we first applied for certification, it was really interesting how much of what they require we already were doing,” Martyn said. “We didn’t know, but we were acting like a B Corp in so many ways already.”

The certification attracts new employees, Stephenson said, including herself. But it’s also maintained in part by employees — the bank has a “B-keeper” committee that all staff can take part in that works on the recertification process.

It’s one of many committees Stephenson said the bank has set up for its employees as part of its mission to be an employer of choice and invest in the community.

“We feel if our employees get it right, our customers get it right, and our customers and our community prosper,” Stephenson said. “We build that trust every day.”

Correction: An earlier version of this story included misspellings of the President and CEO of Brattleboro Savings & Loan’s last name.

Read the story on VTDigger here: Consolidation has changed everything about Brattleboro’s banking landscape — except for one bank .