'Kosher banking' adapts


February 08, 1993|By JACQUES KELLY

It may be a "legal fiction," but Orthodox Jewish depositors never receive interest on their savings at a Reisterstown Road bank. Each month, a "percentage of profits" is recorded on their accounts.

When they pay off a loan, they do not pay interest. The monthly loan charge is recorded as a "share of the bank's expenses."

Some people call the Maryland Permanent Bank and Trust Co., in the 6500 block of Reisterstown Road, a "kosher bank." The term refers to the way this 83-year-old institution accommodates the many cultural traditions in the neighborhoods it serves.

The bank's service to Baltimore's growing Orthodox Jewis community is one of the ways that the single-office bank has become so well established. Ten years ago it was a small, conservatively managed, $2 million building and loan run by two brothers. Today it has $22 million in assets and 15 employees.

It makes commercial loans to Russian immigrant cab drivers, Korean corner store owners and a new African-American-owned greeting card firm. Its business portfolio reflects the peoples along the Reisterstown Road corridor and its neighborhoods, from Park Circle to Owings Mills.

"This business has changed. In the old days when I was asked for a loan on a house, I'd go out and count the bricks," says E. Philbin Sweren, the bank's 71-year-old vice president, who also sits on its board of directors.

Throughout all his professional career, Philbin Sweren has worked alongside his brother, Melvin R. Sweren, 75, a lawyer and Maryland Permanent director.

Their father, Joseph Sweren, a Jewish immigrant from Poland, was among the founders of the old Maryland Permanent Building and Loan Association, which began in 1910 in the 1600 block of E. Baltimore St., in the heart of what was Baltimore's thriving eastside Jewish community.

A group of small businessmen -- among them a plumber, a pickle maker and a soda fountain supply house operator -- held weekly meetings behind a confectionery store.Residents came in on Tuesday nights to make savings deposits or pay off loans.

"In those days every immigrant group had its own savings associations. There were ones for the Polish and the Italians and the Jews. The officers of each one knew their customers one by one.

"That is the way we still like to transact business. We know our people," says Melvin Sweren.

He says his organization consulted a Jewish scholar to comply with Jewish law barring Jews from taking interest from co-religionists.

"In the eyes of the State of Maryland, the share of profits is a legal fiction, but to our Orthodox customers, it is upholding their beliefs. It is an ancient law that people still follow," Sweren says.

His institution weathered the Depression of the 1930s without much trouble. Some depositors withdrew their savings, only to redeposit them the next week when they saw the building and loan was solvent.

As its customer base changed and moved, the building and loan association accompanied its depositors. In the 1940s its office was in the 1300 block of W. North Ave., at Etting Street, on the busy No. 13 crosstown streetcar line.

"I got out of the service at 12 noon one day and my father had me at work there at 12:30," Melvin Sweren recalls of the day in 1946 that marked the end of his World War II Army stint.

After the savings and loan crisis of the middle 1980s, the brothers said they were growing "disgruntled" with the business and considered liquidation. But theirs was a safe and secure building and loan, one that state examiners found as solid as it had always been.

The whistle-clean bill of financial health attracted other investors. Soon Maryland Permanent was making a transition to a full-fledged commercial bank.

It is now known as Maryland Permanent Bank and Trust Co. anoperates from a former Signet office opposite Reisterstown Road Plaza shopping center.

The bank is spacious and orderly; it resembles other suburba financial institutions. Some customers get interest; others get shares of profits. Some barely speak English.

"But everybody speaks the language of money," says Phi Sweren.

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