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With just $3 million in assets, two employees, no ATM, no website, and
no transaction fees, Kentland Federal Savings and Loan is the smallest
bank in America, and it’s been around for over 100 years.
You’ve most likely heard of America’s banking giants – JPMorgan Chase,
Morgan Stanley, Citigroup, Wells Fargo, and the Bank of America – but
what about the smallest fish in the pond, so to speak? Well, at the
opposite end, we have Kentland Federal Savings and Loan, officially the
smallest bank in the United States of America. Founded back in 1920, by
the great-grandfather of its current CEO, this tiny financial
institution has only ever had one branch in Kentland, Indiana, and has
only offered three services – obtaining a home mortgage, opening a
savings account, and opening a certificate of deposit.
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“We were the only institution that didn’t close during the stock
exchange debacle in the late 1920s,” CEO James A. Sammons told
Bloomberg. “People felt secure that their money wasn’t going anywhere.”
But the banking climate in America has changed in the last century, so
Kentland Federal Savings and Loan is like looking back in time. Both CEO
Sammons and his part-time teller are technology-averse and prefer using
mechanical devices like a traditional coding machine to write checks. It
is one of the reasons that Sammons believes that his way of doing
business might end with him.
“When I am finished—whether it’s regulators pressuring us to be absorbed
or me walking away—we will have to be acquired,” the 55-year-old CEO
said.
Another reason for the impending demise of the Kentland Federal Savings
and Loan is the small profit margins practiced by America’s smallest
bank. It has managed to beat the local competition with slightly better
rates on savings accounts and mortgages, but this is the only source of
income, because the bank doe not not have ATM fees, no wire fees and no
transaction fees of any kind.
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