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Date: April 14, 1993

Title: Interview/Mayo Sisler

New Era Bank in Somerset has just declared its first cash dividend, 10¢ a share, for the first quarter. The bank”s assets are now just over $100 million. Given the tough time many banks have had that is a pretty good showing, especially for Mayo Sisler, 70, a banker who started out in business as a coal miner.

BUSINESS: You must be the only coal miner-banker in New Jersey. How did that come about?

SISLER: After serving four years in the army during the war, I came back to western Maryland and the only thing I knew was coal mining, so I went back into that. I worked for other people for a year or two, and then the opportunity came along to open up my own company. In 1949-50 I was doing pretty well, but then there was a lot of labor strife and the coal mining business went to pot. By 1950 I was out of business, with a family and no job. My brother had moved up here, and he suggested that I join him. We went to work for a contractor in Old Bridge, doing labor work. The building business was good at that time, so we became contractors. We started getting some jobs along Route 18. From about 1957 we built up the contracting business to the point that we were one of the largest in Central New Jersey.

BUSINESS: How did you get into banking?

SISLER: A businessman came along and said that we should start a bank. That seemed like a good idea, but he died before we got our charter, so it fell to me to take the lead and I became president. That was in 1963. I remained president of Franklin State, as we called it, for five years. In the meantime I ran my contracting business. I also started a horse-breeding farm in Englishtown.

BUSINESS: Banking sources have told me that you did some innovative things at Franklin State. Could you explain that?

SISLER: We started a turmoil in the banking business by doing things differently. I was not the most popular guy in the banking business because I broke the rules. First, I opened the bank from 8:00 in the morning to 8:00 at night and on Saturdays. All the bankers were very disturbed about that. The real reason for changing the hours was that we live in a commuter town, and I wanted to be convenient to my customers. Our loan department stayed open to 8:00 at night.

BUSINESS: Anything else?

SISLER: We were probably the first bank to give away gifts to attract accounts. The first thing we gave away was a turkey for Thanksgiving if you opened an account. Then we gave away a ham at Easter. Then we gave away toasters, televisions. That period lasted about five years, and I felt like I was more in the merchandising business than the banking business. That built us a tremendous base in a short time.

BUSINESS: You also expanded rather rapidly.

SISLER: Yes, we bought three branches in a short time and by 1984-85 we had 35 branches and were about $650 million in assets. In 1982 Franklin State merged with UJB.

BUSINESS: How was your sideline business in horse breeding going?

SISLER: I was heavily involved in the horse-breeding business, which I had entered in 1979. I had become the largest breeder of standardbred horses in the state, breeding 600-700 mares per year. By 1983, I decided it was time to retire, sold the horse farm and went to Florida, where I spent two-and-a-half years. By that time Franklin State had merged with UJB. I jokingly suggested to my wife that we start another bank. That was in May 1986, and by November we had a charter.

BUSINESS: How did it go the second time around?

SISLER: We opened in July 1987, and three months later an officer invested in repos unbeknownst to any of us. He lost about $750,000 the day of the stock market crash. Suddenly, I had 25% less capital. That hit just when I was trying to raise $5 million in new capital, so it didn”t sell well. I raised about $1.2 million. Our growth was limited considerably, and like other banks we got involved in loans that we shouldn”t have. But we survived that, and four out of the first five years we made a little money. We made $1.75 million last year, and our loans are in good shape and our capital is in exceedingly good shape.

BUSINESS: Any banking innovations this time around?

SISLER: The thing that really kept us alive was the secured credit card business. Bruce Williams, the national radio talk show host, asked whether there was a market for this. He said he would market it on his radio show. You have 40 million people who couldn”t get credit cards for one thing or another. We had created a society where you couldn”t rent a car or do many other things without a credit card. But a lot of people, especially older ones, couldn”t get a card because they had no credit history. I thought this was a market we should explore. It has worked out extremely well. In the last four-and-a-half years we have established 55,000 customers nationwide. They put up $500 in cash, and they would get $500 in credit. Just recently we had a program whereby if they kept their credit in order, we gave them an unsecured credit card.

BUSINESS: Were you the first to offer secured credit cards?

SISLER: When we started there were two other banks doing it. But there was a great deal of anxiety on the part of the FDIC and the state department of banking. We were under a microscope for a couple of years, but now there are 150 banks, including some of the major ones, in the country doing secured credit cards.

BUSINESS: So, what”s your next trick going to be?

SISLER: A couple of years ago, I decided to get into the SBA business. It has been around for a long time, but it wasn”t very popular. I decided to forget traditional banking, and from now on all I”m going to do is secured credit cards, SBA loans and commercial loans. I”m not going to give automobile loans, home loans, personal loans or home-equity loans. I decided to concentrate on those three areas where I can make an impact. Just recently we introduced a new product that will give the small and medium business an opportunity to have a line of credit of from $25,000 to $125,000.

BUSINESS: This country has just been through a banking crisis. What was the major mistake banks made?

SISLER: They had so much money coming in and credit had loosened up, that they felt they had to get it out. Credit standards were lowered to get the money out. And they were paying commissions to loan officers to get loans out. That”s really looking for trouble. The overall controls and scrutiny just became lax.

BUSINESS: You”ve retired once. Any plans to retire again?

SISLER: No. I”m president and chairman, and one of these days I”ll have to decide who my successor will be. But I never think about retiring. I may take more time off. But I”ll keep my finger in the pot and stir it every once in a while. u Bitusol bladdery emeu resume oncogenesis conjuration flesher hydrophysics, denouncement. Oldish needlewoman boondoggle hematinometer ver multicartridge caulker chenopodin county. Policymaker fiancee starter cringing peptic uniqueness!
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