909 SE Bay Boulevard
PO BOX 2280
Newport, OR 97365

A Unique Strategy

For Immediate Release

Thursday, January 13, 2011

Contact: Fred Postlewait
              Oregon Coast Bank

Newport, OR –Nothing infuriates people quite like bank fees. Yet many consumers continue to incur hundreds of dollars of fees annually. Unfortunately, at most banks fees are an important source of profits. However at Oregon Coast Bank, executives have chosen a unique strategy, deliberately attempted to keep fees reasonable and help their customers avoid them. According to a recent statistical analysis, they are succeeding at that goal.

“Sometimes the priorities of a community bank like ours are a little different than those of other financial institutions,” explained Fred Postlewait, Oregon Coast Bank’s President and Chief Executive Officer. “In recent years so-called industry experts have has given a lot of advice to banks on how to increase their profitability by raising fee income. Sometimes the ideas involve sleight-of-hand – such as how to make a free account highly profitable by having numerous fees tagged to it. Sometimes the practices have been in our opinion reprehensible – such as banks that paid larger checks ahead of smaller ones, in order to increase the number of overdrafts. Sometimes financial institutions even resort to using undecipherable disclosures – like on a typical credit card application – that will allow for punitive fees and increased interest rates.”

“We’re appalled by those types of approaches,” continued Postlewait. “The bank does need to earn money and do right by our shareholders, but we do so in a way we can look our customers in the eye. Each of our offices have staff with the authority to make adjustments to our list of fees and charges if they are convinced that it’s the right thing to do. We even steer our customers towards products like Overdraft Protection, which keeps them from bouncing checks.”

When analyzing a bank’s financial reports, the total amount of fees can be found under the category of Non-Interest Income. According to the most recent FDIC data, Oregon Coast Bank’s Non-Interest Income was less than half the average of its peer group (Oregon-based banks with $100 – $300 million in assets). “That doesn’t mean we weren’t profitable,” points out Postlewait. “But most of our profits have come from growth, investments and solid lending practices, not from excessive fees.”

Is Oregon Coast Bank’s unique strategy working? Apparently yes. The bank’s deposits have increased steadily on an annual basis allowing it to grow from one office to five in just nine years.