When cousins Michael and Morris Maurer decided to start a bank from scratch in 1993, they had several major issues to work through. There were regulatory approvals to win and federal deposit coverage to secure. They needed investors, bankers, office space and technology.
But even the seemingly small details required time-consuming care. For one: selecting a name. It had to evoke a feeling of local control and continuity. It had to call to mind the company's strategy of long-term relationships and superior customer service.
They chose National Bank of Indianapolis. At the time, it might have seemed a tad grand for a tiny startup that began as the state's smallest bank. But National Bank of Indianapolis has grown into its moniker.
As NBI approaches the tender age of 13, the federally chartered bank is closing in on $1 billion in assets and handles another $1 billion for clients through its investment-management arm. It is now the state's 15th-largest bank, with nine central Indiana locations. It has enjoyed 12 consecutive years of increasing profit. And its investors-many of them prominent local businesspeople-have seen their shares grow in value from $10 apiece at the start to nearly $50.
Among 72 banks launched in the United States in 1993 and 1994, NBI ranks third in asset growth, according to research performed for IBJ by Charlottesville, Va.-based SNL Financial. From December 1993 to June 2006, the bank's assets grew 6,679 percent.
"Is there anything that sounds more permanent than National Bank of Indianapolis?" asked Morris L. Maurer, the bank's CEO, in an interview. "It sounds like it's been around for 100 years. I think the name helped evoke confidence in the early days."
The idea to start a bank struck Michael S. Maurer after all three of the city's large national banks, Merchants National, Indiana National and American Fletcher National, were acquired by out-of-town financial institutions. Deregulation had come too late in Indiana for local banks to consolidate and preserve local control.
At its core, the concept for National Bank of Indianapolis was: "New bank. Old bankers."
Morris Maurer had been an executive with Indiana National Bank, which had acquired 16 banks in six years before INB sold to National Bank of Detroit. And Michael Maurer had served on the board of Merchants. (He also is a co-owner of IBJ Corp., which publishes IBJ.)
The Maurers began working on the bank idea in February 1993, studying the success rates of other startup banks. Many did OK, but only a few did very well. Naturally, NBI would aim for the top tier.
The bank handpicked the best bankers rather than hiring those looking for jobs, said Philip B. Roby, the bank's chief operating officer and another Indiana National alum. And the executive team took care of their employees, resulting in an annual turnover rate below 5 percent.
NBI added branches as slowly and carefully as it added employees. The bank took over other bank branches at a time when eliminating branches was in vogue. NBI stuck with service as a top priority, offering its account holders free access to every ATM in the city.
"The fundamentals we got right," Morris Maurer, 55, said. "That's the key, really our reason for being."
The bank was able to capitalize on an opening-to lure both disenfranchised bank customers and disenfranchised bankers, said John Reed, a banking expert and executive vice president in the local office of Chicago-based David A. Noyes & Co.
"Banks such as the Bank of Indianapolis have had a great opportunity to pick up a high caliber of people who didn't like being directed from afar," Reed said. "The clients want local, hands-on relationships. Their bankers want to provide that, but they can't do it from the out-ofstate banks."
National Bank of Indianapolis reached $995 million in assets at the end of September. The bank could reach the billiondollar mark this quarter.
In 2005, NBI generated profit of $6.26 million, or $2.62 per share-up 10.5 percent over 2004.
The bank that began with 18 employees now has 230. And NBI's brand reputation is strong: A recent bank survey found 97 percent of customers considered its service excellent, and 98 percent would recommend the National Bank of Indianapolis.
The founders are glad they picked the name they did. Other options they considered, such as Meridian National Bank and Circle City Bank, just didn't cut it.
Neither did the tongue-in-cheek suggestion that surfaced during a brainstorming session: Crosby Stills & Nashional Bank. The founders of NBI wanted a bank name that was catchy, but they also wanted one with its best days still ahead.
"National Bank of Indianapolis is the one that stuck," Morris Maurer said.