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Delta banks find unique challenges, opportunities

Home-grown institutions keeping the Delta green

IN THE DELTA — Green is an important hue here. It’s the color of seemingly endless acres of soybeans, cotton and rice. It’s also the color of money, without which there are no verdant fields.

In many ways, Delta banks are like other small-town banks, focusing on friendly service and personal attention. But being in an agricultural area, they also face certain challenges and opportunities that are unique to the area.

“There is no product mix. We loan money to farmers,” said George D. Purcell, president of state-chartered Bank of Ruleville, a one-bank institution established in 1902. “About 75% to 80% of our business is in agriculture. It’s our life blood. That’s what we do. We’re a Delta bank. We have a very hands-on board that keeps close tabs on agriculture. And we know everybody that comes through the door — we know their problems — which gives us a better opportunity to help them out.”

James H. “Jimmy” Clayton, president of Planters Bank & Trust in Indianola, agreed. “The Delta is what we know. Our focus is to be the best bank in the Mississippi Delta.”

Doing business in the Delta means having to cope with the fickle nature of agriculture and its challenges. Right now that means severely depressed agricultural market. While price woes are common for Delta farmers, having the big three of cotton, soybeans and rice all down simultaneously is a rare occurrence.

“A good farmer with good yields is going to make it. It’s the small farmer that’s just a storm away from disaster,” Purcell said. “They’re the ones on the fence. We have to hang in there with them.”

Alice F. Herbison, CEO of the Bank of Benoit, a state-chartered bank founded in 1904, is especially keen to the planters’ plight. Not only is she the CEO, her husband is a farmer.

“We don’t face problems and issues they have in, say, industrial areas with layoffs or closures,” she said. “But, yes, it does take an understanding of the farmers and their needs, and realizing agriculture is cyclic.

“We don’t just look at crops when determining if they can re-pay a loan. We look at all assets.”

Opportunities also exist. Many Delta banks, while maintaining their small-town atmosphere and focus on agriculture, have managed to not only survive good and bad times but prosper and grow, as well. One of those banks is state-chartered Planters Bank & Trust.

Planters Bank & Trust started out in Ruleville as a small bank holding total assets of $268,000. Since then, the bank has opened offices in Indianola (1940), Sunflower (1941), Louise (1951), Greenville (1970), Inverness (1986) and Cleveland (1997).

In 1999, Planters Bank & Trust continued its growth with offices established in Leland and Greenwood. Today, Planters boasts assets of well over $200 million, and it still has its eye on surrounding horizons.

Planters’ strategy has been to take its well-established reputation as a friendly, small-town bank and plug that into the various other small Delta towns into which it has expanded.

“With all the merger and acquisition and banks getting bigger and bigger, we see a lot of opportunity as a small locally-owned bank to fill the niche they left vacant in our communities,” Clayton said. “And we see a lot of opportunity in the Delta. It’s this opportunity that’s driving our expansion.”

While the bank has grown exponentially, it is still a Delta bank and must cope with the inevitable ag-related issues and problems. Planters, like its smaller Delta peers, sees the current depressed agriculture market as a concern but part of doing business in the area.

“We are profit-motivated. We have a long track record of profit,” said Henry Paris, chairman of Planters who became chairman in 1984 when Clayton was made president. “We will go as far as we can with someone, but we aren’t a charity. However, we have to be sensitive to agriculture’s needs. Small banks in agricultural areas know that, and they understand that eventually things will turn around.”

Perhaps Herbison summed up the general feelings of Delta banks surveyed for this story.

“We’re a Delta bank. When the tough times hit like today, you have to weather out the storm. And when it turns around, we’ll enjoy the good times,” she said.

Contact MBJ staff writer Wally Northway at northway@msbusiness.com or (601) 364-1016.

About Wally Northway

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