After the introduction of the Gramm-Leach-Bliley Act in early 2000 enabled insurance companies and banks to have common ownership, Westfield Insurance approached Jon Park with the goal of starting a bank. Over 30 other insurance companies sought thrift charters during this same time.
Creating a Better Bank
With extensive experience in banking – including community banking – Jon was ready for the challenge. His vision was to create a better bank by finding areas in which a new entrant could out-service larger bank rivals, and provide financial services at a lower cost.
Recognizing the power of building connections, Westfield Bank’s business model revolved around personal relationships with customers and key referral partners. As part of this, the bank committed to making lending decisions locally so it could be more flexible and faster than bigger institutions in this critical aspect. Westfield also stressed the importance of hiring quality people, developing its staff, and empowering employees to act like owners.
Securing a Location
In order to have an approved charter, banks must have a physical location, which is something Westfield Bank lacked. It was assumed that the bank would eventually reside in the historic post office in Westfield Center, but completing the construction would take too long. So, the bank chose an unconventional alternative option – buying a double-wide trailer and placing it in the parking lot of Westfield Insurance in early 2001.
This tactic fit the bank’s focus on internet banking rather than brick-and-mortar locations. Additionally, the reduced costs of operating from the trailer facilitated the bank’s goal of providing customers with lower fees.
In the following years, Westfield Bank grew rapidly as its service-oriented approach resonated with personal and business customers. Its growth accelerated with the acquisition of two community banks, Western Reserve Bank and Valley Savings Bank. These additions enabled the bank to increase its geographic footprint without diluting the flexibility and competitiveness its operating structure allows.
While only a handful of the banks created by insurance companies following the Gramm-Leach-Bliley Act remain today, Westfield Bank has flourished, even during challenging times for both the economy and banking industry. The bank currently employs over 180 individuals, and has more than $1.45 billion in assets.