Coping with the Economy: The State of Banking in Michigan

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The economic downturn struck early in the state of Michigan, where unemployment rates have been higher than most of the nation for years.

In this exclusive interview, Dennis Koons, CEO/President of the Michigan Bankers Association discusses:

About Dennis Koons: Dennis R. Koons has served as President & CEO of the Michigan Bankers Association since January 2002. The MBA represents the interests of and provides services to the banks of Michigan.

Koons is a graduate of Michigan State University and the Thomas M. Cooley Law School. His career includes political campaign management, a staff position in the Michigan Senate, Director of Governmental Affairs for the Michigan Association of Realtors, Vice President for the Greater Detroit Chamber of Commerce and Vice President, Government Relations for NBD Bank.

From 1995 to 2001, he served as the Chief Executive Officer of the 26,000-member Michigan Association of Realtors.

Koons also serves or served civic and professional organizations as an officer or director including the Michigan State Chamber, Habitat for Humanity of Michigan, People and Land, Michigan Society for Association Executives, Graduate School of Banking in Madison, Robert M. Perry Schools of Banking, Michigan Employers Unemployment Compensation Council, Greater Detroit Capital Corporation and the Michigan Council for Economic Education.

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Since 1887, financial institutions throughout Michigan have looked to the Michigan Bankers Association as their primary resource for information, education, government representation, and supporting products and services. The MBA is dedicated to advancing a positive business environment for the entire banking industry and to fostering safe, profitable, and successful banks, which promote strong communities and economic activity in Michigan. Membership includes community banks, regional banks, holding companies, savings banks, trust banks and organizations that serve the banking industry.

TOM FIELD: Hi. This is Tom Field, Editorial Director with Information Security Media Group. We're talking today with Dennis Koons, CEO and President of the Michigan Bankers Association. Dennis, thanks so much for joining me today.

DENNIS KOONS: Well, Tom, thank you for having me. It's a pleasure to be able to talk to you.

FIELD: You and I have talked, and we've agreed these are historic times. So, tell us a bit about your regional institutions. How are they impacted by the recent global economic issues that we're all experiencing now?

KOONS: Well, Tom, first of all, on behalf of the banking industry of Michigan, perhaps of more import is what has been going on in this state for the past six years. As most of the country is aware, maybe not directly as we are, we have been experiencing job loss and economic decline for six straight years, while the rest of the economy and the nation was doing pretty darned well in that same period, up until recent months. So, I think, by far, the more profound impact on banks in Michigan has been job loss. Certainly, I think any of your listeners would understand that, aside from any credit crunch and global situation, when a person loses their job, it has very dire impacts, not only to them, but to many people around them, and ultimately that impacts businesses of all sizes and types, including the local banks. Now, when you then compound that with the events of the last few months, with the tightening in credit, on a global scale, this just is kind of an additional hit to the banks of Michigan.

FIELD: Given that, then, Dennis, how do you gauge the level of customer confidence in banking institutions, and how has it changed in the past year, with recent events on top of, as you say, the hit you already were taking?

KOONS: Well, Tom, we certainly understand that the public is nervous across the entire nation, and in Michigan. Attitudes have not been real positive here in Michigan, with continuing bad news year after year after year. It's not in a severe recession, but it's just one of a duration that certainly I have never experienced. Having said that, the public should have absolute confidence in the safety and soundness of the banking industry of Michigan. We are an economy that has been through ups and downs in the past, our industry is extremely well-managed, extremely well-regulated, and people should have confidence in their institutions.