Samuel Ladd III has been a fixture in Maine’s banking community for nearly 50 years. Born in Portland, he grew up in Brunswick and attended Bowdoin College. After graduation, he worked for Aetna Insurance for a year and then served two years in the Army, returned to Maine in 1966 and took a job at Maine National Bank.
But it was in the middle of a banking crisis in the early 1990s, after the housing bubble burst several years earlier, when he was tapped for what he considers his greatest achievement: to start a new bank in Maine.
Backed by Elizabeth “Betty” Noyce, who had embarked on an ambitious “economic philanthropy” effort to strengthen the economy in southern Maine, Ladd helped launch Maine Bank & Trust. He served as the president, CEO and director of the bank, which was eventually sold to Vermont-based Chittenden Corp. and then Connecticut-based People’s United Bank.
People’s United now has 26 branches and about 235 employees in the state. Ladd retired last month as vice chairman of Maine operations for People’s United.
Q: How did you end up helping to start a bank in the early 1990s, which was not exactly a prime time for banking in New England?
A: We (Ladd and Maine National Bank President Wayne McGarvey) had merged Maine National Bank in 1985 with the Bank of New England and, five years later, what appeared to be a great New England franchise was gone. The FDIC (Federal Deposit Insurance Corp.) took it over (due largely to loan problems at Bank of New England) and put it on the auction block. We got swept up with everybody else and were sold off to Fleet Bank. Wayne and I were the two top people at Maine National and (Noyce’s lawyer) Owen Wells called up and said, “Betty Noyce would like to open a bank and wants you two to run it.” We looked at each other because neither of us had led that good a life to be given that opportunity.
After 10 years into this, Betty died and (Noyce’s) Libra Foundation could not own a for-profit entity, so we found Chittenden (Corp. in Vermont) and sold the bank to them, and that was another great run from 1990 to 2001. In 2007, they sold out at the top of the market to People’s United Bank.
Q: What was it like to build a bank from the ground up?
A: It was pretty scary, especially on opening day, when you realize you don’t even have one checking account. When we came in at 7 in the morning we had people standing in line, and that was both great and scary. I remember opening accounts – I didn’t know how to work the computer, so we opened accounts with a pen and paper. But the people loved it. We were also able to hire some people who were overqualified but bought into the idea of having fun as the local bank. In the early days we weren’t able to make big loans, but that changed in a few years. Betty had a great attitude about it. When we went to her for some more capitalization to open more branches, she gave us more than we asked for. We also brought in a lot of very well-known faces from other banks, so when we opened a new branch we always put the pictures of the people who were in the branch in the paper and people would say, “Oh, that’s where he went.”
Q: What do you think was the biggest factor in its success?
A: A few of us brought along a pretty strong sales culture and we were not afraid to go out and talk about the business. When you went out and told your story, you got welcomed in, people were really nice to you. We tried to show we were the local bank and a little bit of the underdog. I know it drove some of the competing national people crazy when we said we were “the Maine bank for Maine people.” When we merged with Chittenden, the good news was that they were sort of like us and they gave us quite a bit of leeway.
Q: How did you avoid some of the problems other banks have had?
A: We never lowered our credit standards. We were looking for new loans and new deposit accounts, but the problem was when times were roaring, people would come in and say, “The bank down the street is going to do such and such.” We didn’t change our loan standards to try to match what they were doing.
Q: Some of those relaxed standards have led to tighter government regulations. Do those rules hurt, especially since the bank has been sound throughout?
A: The government regulation has been painful and it’s required all banks to add people in the compliance area who will never see a customer. In the ’60s and ’70s there were a lot of loans almost made on a handshake. You do that today and you’d get fired, but the customers understand it’s the rules we’re now playing under. The rules are tough, but the financial industry went through a lot and that brought on a lot of the regulation. I think some of it was to control others in the industry and not the local banks, but we all got covered with the same blanket.
Q: How sound do you think the industry is now, especially in Maine?
A: I think the banking industry is stronger today than it’s been in a long time. Just about all the banks in Maine are in pretty good shape, and those that aren’t are on the road to recovery. Back in the ’60s there were probably 80 or 90 banks in the state and now there are probably 35 or so. So there are fewer choices, but still an awful lot, and some of the bigger banks like People’s United have a level of sophistication for the customer that a lot of smaller banks never had. If they want to do something like mobile banking, they can throw a lot of people at it and it’s solved.
Q: How did banking change for you personally?
A: My personal phone calls have gone way down. People don’t communicate by phone, they either email or send a text message. That’s a reason that bankers today have to spend the face-to-face time with customers, to make sure the electronic world doesn’t run the game. That’s also one of the problems with retiring. I have to get off the bank’s e-mail system. I think I’ve had to contact a few thousand people to let them know my new e-mail, and every day there’s a few more.
Q: How do you plan to fill your days now?
A: I am the chairman of the finance committee for Susan Collins’ re-election campaign and I’m still involved with local institutions, like the Portland Museum of Art and the Gulf of Maine Research Institute, and I hope to spend more time in Florida. Thanks to the Internet, you can still stay connected. I want to play more tennis and golf, but I just can’t go home and turn things off. I think there are a lot of institutions I still want to help.
Portland is a terrific city and it goes beyond the banks and restaurants. It’s a great livable city and a hidden gem. Doing volunteer work here is really fun – you feel like you’re playing for a winner.
Edward D. Murphy can be contacted at 791-6465 or at: