The Advantages to Using a Local Community Bank vs. a National Commercial Bank

When choosing a bank, there are many factors that should be considered. The future of the money that you have earned and elect to save depends upon your making the best choice possible for you and your unique needs.

Large Banks

 

While it is true that both community banks and commercial banks offer many of the same services – in terms of protecting your money and the ability to earn interest on those funds – there are many differences between the two types of banks. In this guide, you will be introduced to those differences and will learn why it is in your best interest to opt for a local community bank.

The Financial Fallout

Immediately following the financial crisis or recession in the year of 2008, the big banking sector was negatively impacted. In short, this was caused by the passing of regulations within the United States prior to the fallout to allow larger amounts of consumers to purchase homes. Many risky mortgages were issued.

Following the recession, commercial banks lost money on the defaults of the mortgages that they issued, bank-to-bank lending came to an immediate standstill, and the credit offered to consumers and businesses quickly dried up. The following occurred among big, commercial banks:

  1. Many banks actually went under.
  2. Other banks had to be immediately bailed out by the United States Government.
  3. Then, there were banks that were coerced into forming mergers with financially “strong” partners.
  4. Most stocks associated with the commercial banks were completely crushed.
  5. Dividends associated with the stocks were drastically cut and numerous investors experienced financial losses.

The question you have to ask yourself when opting for a commercial bank is, “Will this happen again?”

While there is truly no way to know for sure, financial experts believe that it will. If it does, do you want to take a chance of losing your money or other financial assets?

If you answered “no”, continue reading to learn how choosing a local community bank will help you.

Local is Better

What is a Community Bank?

A local community bank is one that is chartered under state laws. It, too, is considered “commercial”; however, not in the same sense as larger, national banking chains. A community bank pulls its funds and lends funds from the community where it is in current operation. Best of all, it is not affiliated with a holding company that manages several banks. The advantages of opting for a community bank include – but are not at all limited to – the following:

  1. Community banks specialize in creating personal relationships with all of their customers.
  2. Community banks help in supporting local businesses.
  3. Community banks help in the growth and the success of the local economy where it operates.
  4. Community banks are able to extend access to certain programs and features to customers that national big banks may deny.
  5. Community banks often offer lower fees than big chain-based banks.

Somerville Bank Location

Choose Somerville Bank

If you are in search of a local bank that offers personable service, choose us here at Somerville Bank. Our most important asset is not our monetary worth, but you – the customer.

We value each and every individual that elects to conduct business with us and we protect your financial livelihood. We have the same services and features that large commercial banks offer, but tailored to you, for you.

For more information, visit one of our many

Locations