We developed the commentary below at the invitation of the Canton Citizen newspaper for a special feature on local banks. It originally ran in their March 30, 2023, print edition.
Two basic concepts separate Bank of Canton from the troubled banks making headlines: long-term-focused risk management, and 100% deposit insurance.
Bank of Canton is a mutual savings bank, not a stock bank. We’ve operated for the benefit of our clients and communities since 1835. We’re not owned or controlled by shareholders; we’re owned by our clients – people just like you. This corporate structure allows us to focus on long-term performance and stability, not quarterly returns.
Our leadership team, overseen by our board, develops strategies for both the short-term and long-term success of the bank, factoring in various possible economic shocks – things like recessions, interest rate shifts, and wildcard events like Covid-19. This preparation is part of our risk management program, which we monitor constantly. Occasionally, to preserve the bank’s health and flexibility in the long term, we make financial sacrifices in the short term (as we did by not overextending ourselves when interest rates were low). But that flexibility allows us to withstand sudden changes in market conditions, as we’ve done with the rapid rise in interest rates.
Today, our positioning of loans, deposits, cash reserves, and investments is well prepared for the current business environment. We’ve maintained a diverse loan portfolio, deposit base, and other funding sources, so we’re not overexposed to any one single industry or financial trend. Our liquidity ratios are in the top 20% of our national peer group, and our capital levels and profitability are strong.
In addition to having a solid balance sheet and strong earnings, we’re a member of the Depositors Insurance Fund (DIF) of Massachusetts, which insures 100% of all deposits above Federal Depositors Insurance Corporation (FDIC) insurance limits.
As you evaluate your banking relationships in light of current events, please consider the value of historical performance, mutual ownership, DIF insurance, and proven fundamentals that have stood the test of time.