Banks safe here in Crowley
By Howell Dennis
CROWLEY – The strain on some of our nation’s banks recently, highlighted by the failure of IndyMac Bank last week, has had some people worried about whether their accounts are safe. However, while banks in other parts of the country have had their problems, Louisiana banks have remained stable. And in Crowley, the problem is virtually nonexistent.
“It’s strange because you always see Louisiana ranked near the bottom of all these lists,” said financial advisor Sandy Melancon from her office at First National Bank. “But in this instance, our community banks are strong.”
One of the strengths of some of our local banks is that they generally deal with people they know and rarely with people out of their market area. Because they make it a point to know their customers, the number of high risk loans or subprime mortgages is minimal.
“Most community banks don’t have the problems that were generated by the large banks or mortgage brokers,” said Randy Prather, President of First National Bank. “We always place emphasis on recommending that people seek advice from those they trust.”
Prather pointed out fluctuations in the home market that saw some home values in some states shoot up and then plummet were primarily in only a few states.
“States such as California, Nevada, Arizona and Florida saw their home values shoot up which was great in the short term,” he said. “But when this happens, it leaves them more susceptible to a downturn.”
Prather pointed out that it had become too easy for people to qualify for home loans. He noted that people should not jump into a home purchase without doing their research.
“The potential for volatility exists in all investments, and owning a home is no exception. Building equity in one’s home is one way the homeowner can protect himself from fluctuations in the market,” said Arlene Albarado, FNB’s Chief Financial Officer.
Prather also pointed to a statement by Louisiana banking commissioner John Ducrest which stated that “we are much better prepared” because we have bank management in place in many Louisiana banks that went through the tough times of the 80’s and 90’s.
“We pride ourselves on being a well-capitalized, clean bank,” Prather said. “We don’t jump in and out of markets like some larger banks do.”