The defunct Suburban Federal Savings Bank, which succumbed to the mortgage crisis, is now Essex Bank and the new owners want to let everyone know it's a new institution with better standards.
On Wednesday executives with Essex, headquartered in Tappahannock, Va., began a four-day tour to hold grand openings at the seven branches it bought in January when Suburban Federal became the first Maryland bank to go out of business because of bad real estate and construction loans. They'll follow up with a marketing campaign that includes television commercials and mailings later this summer.
The grand openings began at the branch in Clinton in Prince George's County where they hosted a ribbon-cutting ceremony and provided cake and punch for customers. A group of children from St. John's the Evangelist School in Clinton, which partners with Essex in a program to teach kids to save money, was also at hand for the festivities. They'll end the tour at Suburban Bank's former headquarters in Crofton.
"We want to let the public know it's business as usual," said Andy McLean, president of Essex, adding later the bank will enhance services. "It may be a different name, but it's still their bank."
Essex bought most of Suburban Bank's assets and many of its loans in January after the Federal Deposit Insurance Co. stepped in when the bank couldn't find a buyer to help offset millions of dollars in bad loans. In addition to the Clinton and Crofton locations, Essex also acquired Suburban's branches in Landover Hills, Rosedale, Catonsville, Rockville and Arnold.
"The credit culture at Essex is a lot stronger than what was here before," said Richard J. Oppitz, a former Maryland bank executive who was hired as regional president by Essex.
Essex executives said Wednesday that although the branches may look the same and the employees are the same - they kept everyone but the president - it will be a better run bank.
It will offer more services because Essex is a commercial bank, while Suburban was a thrift; the bank will expand small business services, for instance. The executives also said that its lending standards are better than those Suburban had in place.
"We have a very conservative approach to banking in terms of how we manage and underwrite risk," said George Longest, Essex Bank CEO.
Bert Ely, a banking analyst in Northern Virginia, said Essex's ability to buy Suburban shows some financial stability.
"The fact that Suburban failed and Essex was able to come in and make the acquisition says a lot right there," Ely said.
What Essex says it will maintain is the community atmosphere Suburban was known for, where tellers and bank managers address people by name, executives said.
"The customer banks with a banker, not the bank," said McLean. "They want to know familiar faces."
Jean Atkinson of Oxon Hill was glad to see Essex kept the staff from Suburban because that's one of the reasons she liked the bank.
Essex executives hope to grow their customer base and said they are considering more new branches in Maryland.