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A modern manger of Bethlehem

(Article published in the Dec 28,2011 issue of Manila Standard Today) 

It seemed like one of the fictional vignettes in the ancient collection of birth narratives of Matthew or Luke.  But no, this one is from a contemporary chronicler, the International Herald Tribune, and, I have no reason to believe otherwise, in fact true.

The IHT item, meriting page 1 treatment in the December 24 issue, was about a small bank named “Bank of Cattaraugus” in a small town in New York state, population 950, more or less the same as those in Bethlehem.  In today’s mania for “bigness”, a mantra pursued by the likes of Citibank and J.P. Morgan Chase, the Bank of Cattaraugus sounds like a discordant note; a sharp but welcome anomaly, at the very least to the community it services.

The Bank of Cattaraugus was founded in 1882 by 20 prominent residents, -- one of them was a Civil War surgeon and a cousin of Davy Crockett of the wild frontier, -- who were moved by the idea of setting up a bank to take care of the small folk’s funds as well as fund the needs of local businesses.  True to its mission, the bank is said to have rarely booked over $50,000 annual profit; last year, management reported income of $5,000.

That the figures are that small is not surprising.  The bank has only one branch with only eight employees, and conducts no credit default swaps and other fancy transactions involving sharp pencils and other financial accounting gobbledygook.  It simply accepts deposits from the community and lends to the community it serves, the small town of Cattaraugus.


Cattaraugus is, from the distorted lenses of a citified eye, a place that progress has left behind; it is not, as described by the Bank’s President, “on the way to anywhere.”  It has only one industrial concern, the Setterstix factory, which made paper lollipop handles.  Other manufacturers had since folded up or transferred elsewhere.  The school district is its biggest employer.  Many residents live with whatever their pensions from the government can buy for them.

In this real-life re-enactment of the little town of Bethlehem, the Bank of Cattaraugus plays the manger.  The function of the manger in the birth narratives is not to epitomize, as many preachers still erroneously told us last Christmas, the humility of the divine who stooped down to the level of the human.  Instead, a manger is, at least according to modern biblical scholars, intended to teach indirectly that the pave it is cuddling is source of nourishment.  Its message is the same was John the Evangelist’s rendition of “I am the Bread of Life.”

For more than a century now, the Bank of Cattaraugus was residents of Cattaraugus’s manger.  Early this month of December 2011, Carol Bonner, who was 61 years old and was caring for a disabled sister, needed to have the bent right-bank rim of her car repaired.  She had to have her car ready for the snow with winter setting in.  The repair job, she was told, would cost $244 which was more than 50% of her weekly pension check.

With no savings to fall back on, nor credit car to postpone payment with, she did what others in her community similarly situated did:  she borrowed from, and was quickly granted a loan from the Bank of Cattaraugus.

She was confident she would be helped by the Bank of Cattaraugus.  A few years back, she was in another sort of financial trouble; because she was unable to pay her property taxes, she had to sell her home which was mortgaged with the bank.  The bank president had his son, who lived in another state and who had no intentions to use the property, buy it.  He had his son lease the property back to Ms. Bonner, and abling her and her sister to continue in possession Ms. Bonner was not an exception.  In fact, she was one of the many who were the rule.  Like her, a bus mechanic, who obviously had to work with his hands, temporarily lost his job because he shot off his finger while putting his hand gun in its holster.  He had a loan that was falling due.  The Bank of Cattaraugus, almost routinely, granted him a “forbearance”, an old term for what high fallutin finance men currently mean by “restructuring”.

An Amish customer wanted to borrow $80,000 in order to consolidate his liabilities.  His income flow, however, in no way would justify a loan of that amount.  He earned only $2,300 a year selling greenhouse starter kits.  He nevertheless was granted the loan by the Bank of Cattaraugus.

The bank was not being imprudent at all.  It knew Amish culture very well, that every son worked and everything earned by the sons went to the father until they reached the age of 21 or had gotten married.  This Amish borrower had 8 sons, all working and earning at least $10 per hour; putting all the inputs together, the bank was good.  Knowing its customers very well and, taking into account significant, though not necessarily the figures taught as crucial in Banking 101 the Bank of Cattaraugus simply did what is what it was expected to do, handle with care the money of other people.

Like the manger of Bethlehem, though, the Bank of Cattaraugus is beset with danger from without.  Largely because of the sins of its more bigger and more urban brothers, the Bank of Cattaraugus’ cost of complying with mandates of the regulators have been going north even as the interest rates, which are the bank’s main source of income, have been heading south.

          There have been movements, like the Move Your Money Project whose slogan is “Invest in Main Street, Not Wall Street”, and the, that are seeking to convince the of US of A to deposit more of its money in small banks like the Bank of Cattaraugus.  Only time will tell whether their efforts will in the end make a difference; but for now, the hopes and fears of Cattaraugus rest in its bank tonight.