Strategy for Success: 'Keep Your Eye Upon the Doughnut'
Hoosier Banker › Vol. 89 Nbr. 4, April 2005
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Summary
The strategy of Third Federal Savings and Loan (Cleveland, OH) has been to remain focused on the doughnut rather than on the hole. Third Federal's management has served its community stakeholders with a record of asset growth and profitability. The thrift has also been on Fortune magazine's list of the 100 Best Companies to Work For since 1999. There are lessons to be learned by other mutually owned banks from the success of Third Federal: 1. Set targets to grow assets in real terms. 2. Plan for the smart marketing of deposits. 3. Use leverage to maintain momentum. and 4. Control noninterest expenses.
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Strategy for Success: 'Keep Your Eye Upon the Doughnut'
When I worked in Cleveland in 1974, I would pass the Old Mill coffee shop on Euclid Avenue. The Old Mill was well known for the quality of its doughnuts, which it promoted with an adage: "As you wander on through life, brother, whatever be your goal, keep your eye upon the doughnut, and not upon the hole!"
That advertisement holds a lesson for mutually owned banks. Too often, investors and the executive management of mutually owned banks focus on the perceived negatives - the "holes" - associated with these institutions, b...See the full content of this document
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