As trust has eroded in the large financial services companies that caused a near-collapse of the economy, many citizens have turned to community banks for their banking needs. Community banks refrained from the excesses of their larger competitors, and as a result “they are the ones still loaning money,” according to Steve Hack, commercial loan officer at Ulster Savings Bank. “They are also the ones you can lean on for financial advice.” Many local banks are rated highly for safety and security by the FDIC and Bauer Financial. By leveraging technology, local banks have the advantage of offering all the products available from large commercial banks, but with a personal touch. Local banks also support the community, donating money to a variety of charitable causes. And their employees contribute by volunteering their time.

 Right now it’s harder than ever to get a loan, but local banks are coming to the rescue: in the “Credit for Success” program, eight Ulster County banks, including Ulster Savings and Rondout Savings, have formed a consortium in which each has contributed money to a $1.6 million fund that will offer loans ranging from $25,000 to $150,000 to qualifying Ulster County businesses. The loans are made through the New York Business Development Corporation. The program was devised as a way to spread the risk in loosening up credit for businesses “that just need a little help to ride out the conditions,” according to Lance Matteson, executive director at the Ulster County Development Corp., which put together the consortium. To qualify, a business must have been declined by a bank and work with the Small Business Development Corporation to develop a business plan. Contact a participating bank or call the SBDC at 339-0025 (or e-mail sbdc@sunyulster.edu) for more information. The program has won the support of Senator Charles Schumer, who has pitched it across the state as a model for small-business lending and recently promoted the idea in a letter to President Obama.

 Here’s a closer look at the services and community contributions of Kingston’s local banks:

Ulster Savings Bank, which has been in business since 1851, has 13 locations, two of which are in Kingston. It offers small businesses a variety of products, including bookkeeping, payroll, and cash management. The bank offers residential and commercial lending and deposit as well as investment services. Besides its participation in “Credit for Success,” USB has a loan fund with the City of Kingston for owner-occupied businesses, which can borrow up to $75,000 at favorable rates. “The bank is committed to seeing small business owners through this crisis,” said Hack. “We want to work with our customers so that on the other end they are much stronger.”

USB’s Freedom Select program offers vacation tours and day trips for customers who are age 50 or older and have deposited at least $25,000 in the bank. The Panama Canal, Spain and Portugal, and Boston are among the trips planned for 2010. The bank supports a charitable foundation, which provides grants to not-for-profits as well as student scholarships and class-room grants; Benedictine Cancer Center, the YMCA, and the Center for Spectrum Services are among the beneficiaries. The corporate giving program includes donations to the Farmers Market in Uptown Kingston, Gateway Community Industries, and both hospitals.

Rondout Savings Bank, in business since 1868, has two Kingston locations. President Jim Davenport estimated 35 percent of the bank’s business consists of family businesses and professionals. In considering loan applications by small businesses, “we take time to get to know the story behind the financial numbers,” said Davenport. “We don’t base our loan decisions solely on credit scores and ratios. We understand it’s people who pay loans back. We’ve always had the mindset, ‘let’s try to find a way to make a deal.’”

The bank offers letters of credit, commercial mortgages, term loans, investment services, money market accounts, and financial services through a subsidiary. Funds are donated to hundreds of community organizations through the bank’s “Dividend to the Community Program.” Employees volunteer for the Girl Scouts, United Way, and Big Brothers/Big Sisters, among many other organizations. Each year the bank holds bake sales, raffles and a giant yard sale for specially selected charities (in 2010 they are The Queens Galley, The Happy to Help Food pantries, and the WGHQ Happy Christmas Fund).

Rhinebeck Savings Bank has a Kingston branch at 27 Main Street and caters exclusively to commercial customers, according to branch manager Bridget Smith.  Deposit accounts, merchant services, remote capture and free checking are among the services for small businesses. The bank’s CD account register provides FDIC insurance up to $50 million. Decisions about loan applications “are made from here, not a corporate headquarters,” noted Smith. The bank donated over $200,000 to not-for-profits in Ulster and Dutchess counties last year, and many employees volunteer. Smith, for example, serves on the board at Gateway Community Industries, and her colleague Bryan Smith serves on the board of directors at the YMCA.

Yet another local banking option is the Mid-Hudson Valley Federal Credit Union, a financial cooperative with 55,000 members that originally started as a cooperative for IBMers. It offers full service retail banking and lending, and its interest-bearing checking account—available to customers with a $5,000 balance or $15,000 in CDs or savings–offers free identity theft protection, insurance incentives, and life-style coupons.  The MHVFCU is an active lender, according to senior vice president of marketing Bob Michaud. It offers deposit products and payroll services, merchandise services, and other products through subsidiaries. In considering a loan application, “we hop in the car and look at the company,” said Michaud. The credit union offers a credit card with a 9.99 annual percentage rate—much lower than that of bank cards—and is about to launch a product for college loans. It also offers 24/7 telecom customer services.

 The MHVFCR has two flagship causes, the Junior Diabetes Research Foundation and Relay for Life (an event sponsored by the American Cancer Society). It also supports dozens of not for profit organizations.