MICHELE NORRIS, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Michele Norris.

MELISSA BLOCK, host:

And I'm Melissa Block.

Here's a quiz: After Hurricane Katrina, where have people in New Orleans turned to get back on their feet? A, FEMA; B, a church charity; C, Brad Pitt; D, a bank president. The answer is all of the above. And this story is about option D.

NPR's John Burnett has this profile of the bank president at Liberty Bank.

JOHN BURNETT: After losing its headquarters, its records, six of eight local branches and most of its customers to the storm, Liberty Bank has just finished its best year in history. It earned more than $3.5 million on $324 million dollars in assets. In fact, Liberty has just opened branches in Houston and Kansas City.

Mr. ALDEN McDONALD JR. (President and CEO, Liberty Bank and Trust Company): We always tell ourselves that whenever there's an obstacle, the O for obstacle also stands for O for opportunity. And we did what we do best, and that is to help people. And when you help people, the Lord gives it back to you tenfold.

BURNETT: Alden McDonald Jr. is president and CEO of Liberty Bank and Trust, New Orleans largest black-owned bank headquartered in one of the worst storm disaster zones, New Orleans East.

After a calamity, people need money to repair homes and replace cars. When their lives imploded, the deeply loyal customers of Liberty Bank turned to McDonald.

Dr. BEVERLY WRIGHT (Executive Director, Deep South Center for Environmental Justice, Dillard University): I guess the thing that I appreciate so much is that Alden was there and he came on and said we will take care of you.

BURNETT: Beverly Wright is a native New Orlenian, director of an environmental justice center at Dillard University, and a longtime bank customer at Liberty. After the storm, she needed a loan to buy a house in Baton Rouge, but all of her personal records where in her house in New Orleans East.

Dr. WRIGHT: You're in a room now filling out papers, and they're asking for support that's underwater. I mean, what's your proof of salary? If you're divorced or whatever, you need papers showing divorce. If you have other properties that you own, you know, where's the proof of all of this? We had nothing.

BURNETT: Yet, Liberty made loans without collateral, with no money down, simply on trust. And post-Diluvium New Orleans, its customers were desperate. They had evacuated to far-flung cities and needed money. Back up records were temporarily lost, so the bank had no idea how much a person had in his or her account.

McDonald could have shut down the bank's ATMs until the records were back online, but he didn't. He gave each customer a $500 daily maximum and hoped for the best.

Mr. McDONALD: That was scary.

(Soundbite of laughter)

Mr. McDONALD: All of my records got washed out, but that wasn't the customer's problem. The customer's problem at that point was how do I get money. How do I rebuild my life?

BURNETT: The bank ended up getting burned for about $1 million in ATM overdraft, another couple $100,000 was looted from cash machines and bank branches.

At the end of 2005, the bank showed a million and a half dollar loss, but the president says he has no regrets.

Mr. McDONALD: I always operate on some advice I got from my grandfather years ago before I even got into the banking business. And he said 97 percent of the people in the world are honest. He said, so make the rules for 97 percent, not the 3 percent of dishonesty.

BURNETT: Alden McDonald Jr. is 64, with short, cropped white hair. He wears dark banker suits and speaks cautiously as one who weighs his words. To see his bank headquarters today is to understand the concepts of vision and hope - two generally overused words.

The six-story smoky glass building overlooks New Orleans East. Previously a thriving area of black middle and upper-class homes, it had the fortune to be situated directly between lakes Pontchartrain and Borgne which rose conjoined and turned New Orleans East briefly into a suburban Atlantis.

Mr. McDONALD: So we're standing in the bank's boardroom, and we're looking east. We're looking east, that's correct. And to my right is the - used to be the Methodist hospital, and that hospital is still vacant today. That office building is still vacant over there; that was a hospice.

BURNETT: Across the city more than half of New Orleans residents have come home, many who have not returned live in the bank's mostly black customer area. In New Orleans East, the return rate is closer to 20 percent.

So the view from this window is still - at two and a half years after the storm - something of a wasteland.

Mr. McDONALD: Oh, Absolutely.

BURNETT: McDonald is driving down nearly deserted streets in his blue Lexus, which like everything else he owns is new. His family home and all their belongings where inundated. He lives in Baton Rouge and commutes to work.

Liberty Bank has become a symbol of the city's plucky spirit. Five out of eight local branches have reopened including this one in Gentilly. McDonald climbs out of his car and strides with a lumbering hurried gait into the lobby where the customers all seem to recognize him.

Mr. McDONALD: How are you? How have you been?

Mr. ARMAND OLIVIER (Owner, Olivier Creole Restaurant): All right. Okay?

Mr. McDONALD: You doing all right? How's business?

BURNETT: He shakes hands with Armand Olivier, owner of Olivier's Creole Restaurant in the French Quarter. Olivier says McDonald loaned him the money to open his restaurant 16 years ago when no one else would.

Mr. OLIVIER: He kind of reads people, and sometimes he might make a loan just on the strength of people. And we don't let him down. We pay him back every penny.

BURNETT: McDonald is a native New Orleanian going back four generations. His grandfather was a dentist. His father a waiter at the city's exclusive whites-only Boston Club. Alden Jr. broke boundaries in a business dominated by the men to whom his father served bourbon, Sazeracs and Old Fashioneds.

In 1966, he became the city's first African-American loan officer. And in the 1972, he was the founder of Liberty Bank, the city's first black-owned bank. Now there are three. He's back in his car driving through the Pontchartrain Park neighborhood.

Mr. McDONALD: This was the first African-American subdivision in the state of Louisiana. Look at it now, it's all vacant. No life in here.

BURNETT: He passed these moldering, overgrown houses that have not seen a broom or a paintbrush since the floodwaters receded.

Did your bank have a lot of customers in this neighborhood?

Mr. McDONALD: Sure did. A lot of customers. And we finance a lot of these homes as well.

BURNETT: McDonald, who sat on the mayor's now-disbanded Bring New Orleans Back Commission, is frustrated at the lack of reconstruction in these hard-hit precincts and at the laissez-faire attitude at city hall and in Washington. His got a plan to contact every single resident on a street, find out what they need to come home, then tap a risk pool and get them the money to rebuild.

Mr. McDONALD: This is the area we're going to start with, right here, with that program. We got the letter, and we go door-to-door and begin (unintelligible) all of these individuals who want to come back. And then once we get this going, the rest of the community should really begin to take off.

BURNETT: It sounds simple when he describes it, but like everything about the aftermath of Katrina, it's not.

So New Orleans' challenge is Alden McDonald's challenge. How to get the people back? How to replace the equity and assets that took people generations to build and which was washed away in one afternoon.

John Burnett, NPR News.

BLOCK: You can hear profile of other people working to rebuild New Orleans at our Web site at npr.org.

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