Gulf Banks Vie to Help Hurricane Victims
SCOTT SIMON, host:
Several neighborhoods around New Orleans will have electricity, water and security, but businesspeople there, like those everywhere, need something else, too. They need money. NPR's Adam Davidson reports on the extraordinary effort required to get the financial infrastructure of New Orleans rebuilt.
ADAM DAVIDSON reporting:
Sidney Torres is jumping the gun. He's opened two hotels in the French Quarter, mostly for US marshals. And the night before the city opens, he's throwing a New Orleans party in Jackson Square.
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DAVIDSON: James and Troy Andrews are playing. Later there will be barbecue and shrimp gumbo. Torres says he couldn't have done it without the help of four different banks who he met with shortly after the flood.
Mr. SIDNEY TORRES (Hotel Owner): First off, I asked how they were and how their family was, and they in return asked the same, and--'cause we're friends. We're like family. My bankers, the people who make loans to me, are guys who I have relationships with. And they understood because they were going through the same thing I was going through.
DAVIDSON: Now he has all the funds he needs to run his business. He's even getting a few million in loans to expand during the reconstruction. Kyle Waters says it's incredible that banks are working so shortly after the flood's devastation. Waters runs commercial and personal banking for New Orleans' Hibernia Bank, the largest in the state. These days, he's camped out in a borrowed cubicle in Baton Rouge.
Mr. KYLE WATERS (Hibernia Bank): You multitask continuously. I mean, you literally have two telephones going at one time; you have people in your office talking to you; you're making immediate decisions; you don't have time to do too much. But at some point you have to stop and think about what the next steps are.
DAVIDSON: Today's big task is helping out some of the evacuees who are in the Centroplex, a large shelter in Baton Rouge. Waters spoke on the phone to another banker in town.
Mr. WATERS: No, they have nothing. They have nothing. They don't have their FEMA checks; that's what--they want to try and get their FEMA checks, but rather than us just bring $3 million in cash to the Centroplex in an unsecure situation, we're going to bring them to the banks and let them cash some checks and get checks and ATM cards, if we can.
DAVIDSON: There's always more to do. Branches are underwater; at least one ATM machine was broken open during the looting. A quarter of the bank's staff has not been located. He's facing problems he's never seen before.
Mr. WATERS: This is wet currency that was brought in literally in a suitcase, dripping down the branch. The gentleman put the suitcase on the teleline, water just dripping all over the counter of the depo--of the teleline. And we took the cash, we brought it upstairs into a secured area and just peeled $20 bills off and just laid them out on the floor, on the table, hung some, stapled them to the walls, anyplace we could find room to dry out this cash, this smelly cash--horrible smelling cash.
DAVIDSON: Waters says banks in the area are breaking all the rules. He had to smash open a drawer that held the keys to a vault. He's instructed tellers to give at least a few hundred dollars to anyone who has a credible claim to an account. And now he's getting ready to offer credit to those moving back to New Orleans to rebuild. The bank has lowered credit requirements. This last bit makes Larry Meyer nervous. He's a former governor of the Federal Reserve.
Mr. LARRY MEYER (Former Federal Reserve Governor): We have to be careful here. And that is there's a role for the federal government that makes assistance available as part of the relief effort. That's not the role of banks. I mean, banks have to make loans when they know can be repaid. That's the way our system works.
DAVIDSON: Meyer says banks shouldn't overreach. Nobody benefits if local banks collapse. Waters is not worried. There will be some fraud, he expects, but not much. And if you help a customer out in a crisis, they'll be loyal for the rest of their lives.
Adam Davidson, NPR News, New Orleans.
SIMON: Eighteen minutes past the hour.