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I'm Chevy Chase and You're Not: A Local Bank Is Bought

bankcard.jpg

So, bye-bye Chevy Chase Bank, FSB. I try not to get too emotionally attached to large financial institutions (after all, I don't think they really care that much about me) but it's always sad when a local business vanishes from the landscape, especially when that business namechecks a specific neighborhood.

Of course, maybe Capital One--which is buying Chevy Chase Bank--is named after the Nation's Capital, ie, Washington. And I suppose it's a local company too, headquartered in McLean. But the name probably means "capital" as in "wealth, whether in money or property, owned or employed in business." If that's the case, maybe their name should be Capital Zero or Capital Minus One, given the sorry state of the financial markets.

I know only two things about Capitol One: They have funny TV commercials that I don't really understand. Why are Vikings trashing peoples' homes? What's that got to do with credit cards, exactly? Oh, other credit card companies act like savages? Everyone knows, though, that all credit card companies turn on you eventually, the attractive interest rate soon ballooning, the odd fees showing up on your statement.

My other scrap of opinion about Capital One is annoyance at how brightly lit their headquarters building is at night. It's right near the Beltway and you can see it glowing like a chemical fire. Hope you're using energy-saving lightbulbs, guys!

So, no more Chevy Chase Bank. Apparently they'll change the names of all the branches and send us new ATM cards. Somewhere at the back of some shoebox in the Kelly archives is an ATM card from my first bank, the one I opened an account with when I started college and was working part-time at a photo lab. Once a week I'd stop at the Suburban Trust on Route 29 in White Oak and deposit my paltry paycheck. I left Suburban before it left me, so perhaps the demise of Chevy Chase is payback. Suburban is now part of Bank of America.

That's what happens in consolidating times: Big fish eat little fish and then are eaten by still bigger fish. A neighborhood bank becomes a regional bank. A regional bank becomes a national bank. Bank of America is folded into Bank of the Western Hemisphere, which is bought by Bank of Planet Earth, which is bought by Milky Way Bank.

And I bet the Milky Way Bank still charges me $1.50 when I use an ATM belonging to the Bank of the Andromeda Galaxy.

By John Kelly  |  December 4, 2008; 9:00 AM ET
 | Tags: Chevy Chase Bank, local businesses  
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Comments

Until recently Wachovia, a presence in the area, may have seemed too big a fish to be safely swallowed, but its ownership will pass to Wells Fargo.
There was a time in the 1980s and 90s when I was never sure from month to month what new name my bank would go by.

Posted by: cktirumalai | December 4, 2008 10:24 AM | Report abuse

Oddly enough, little Burke & Herbert Bank continues to survive. I have no idea how healthy it is, of course.

Posted by: tomtildrum | December 4, 2008 11:02 AM | Report abuse

tomtiltdrum: Not too long ago I read an article in ther Post about Herbert and Burke, which stressed that it valued its personal relationship with all its customers. No bundled mortgages.

Posted by: cktirumalai | December 4, 2008 11:48 AM | Report abuse

Capital One is the remains of the credit card division of Signet Bank, headquartered in Richmond. After spinning off their credit cards, Signet became Crestar and Crestar became SunTrust. Now the credit card company is trying to become a bank again.
Similarly, MBNA was the credit card division of Maryland National Bank. Maryland National spun off the credit cards, then became Nations Bank, which became Bank of America. Then Bank of America bought MBNA. And so it goes...

Posted by: didnik | December 4, 2008 12:20 PM | Report abuse

As the "Riggses" found out, even when your bank is "on the money," it may not survive.

Posted by: mfromalexva | December 4, 2008 12:40 PM | Report abuse

Down with Chevy Chase Bank. I feel bad for the dedicated employees but Saul built a horrible business model on one product line and ran the ship into the rocks all by himself (not taking advice from his employees and only keeping those who agreed with him 100% at the top). If he would have diversified his business model he would have never had to sell.

Posted by: funtimes1 | December 4, 2008 12:55 PM | Report abuse

Didnik,

Capital One does not envision itself as a traditional bank. It is systematically purchasing "banks" in an effort to utilize the deposits to feed its credit card and auto loan businesses, both of which are still extremely profitable (auto loans to a lesser degree obviously). There is also the significant boost in "brand image" as well as the foot traffic to peddle its other wares.

Posted by: globalone | December 4, 2008 1:08 PM | Report abuse

Funtimes,

I'm not really sure what else could have been done. Using what was an incredibly strong deposit base, Chevy Chase entered the auto loan business only to realize that the margins were paper thin. Once out of that, they then entered into what was a very lucrative home mortgage business. Until now, that is.

My guess is that the family is retrenching and focusing their energies on the segment of the business that they are extremely good at running - real estate.

Posted by: globalone | December 4, 2008 1:14 PM | Report abuse

Exactly. Because at the moment there is still value in "brick and mortar", they want the branches and the deposit customers. Not sure how many of those folks will buy the "local" angle though. My point is that it comes and goes and will keep on coming and going.

Posted by: didnik | December 4, 2008 1:15 PM | Report abuse

Glabalone - I disagree. Greed took control of the mortgage portfolio by having structured loans and allowing LTV higher then industry standards to attract business (it worked). Monies were not allocated to other product lines to build an evenly distributed product line so that if one failed another would hold it up. Building a balanced spreadsheet is what was lacking.

Posted by: funtimes1 | December 4, 2008 2:57 PM | Report abuse

I had capital One card & it was not good. sogan"whats in you wallet" is ruse & thieft is truth.

i tried to do 30 days with no ADDED fee non payment, AS OFFERRED & was charged anyway. I called & asian man started making racial slurs at myself. calling me dumb, white & stupid to believe in advertiseing. i closed account. capital one is disgrace.

now with such poor operations, capital one goes for heart of garden set. good luck.

Signed:PHYSICIAN THOMAS STEWART VON DRASHEK M.D.

Posted by: thomasxstewart | December 4, 2008 4:08 PM | Report abuse

Not a big fan of Chevy Chase Bank either but I'm sorry to see this institution and others like Citizens Bank ("Day time, night time, Saturday too....") and Riggs Bank ("The most important bank in the most important city in the world").

Does this mean the field at Byrd Stadium is now Capital One Field? Sheesh!

Props to the Burke and Herbert's, Sandy Spring's and Provident's for hanging on in the dog eat dog world of banking.

Posted by: BBride | December 4, 2008 4:14 PM | Report abuse

What's too bad about this is that I will no longer be able to tell newcomers and visitors to the area the story of how the bank got its name.
You see, it was like this. There was a stickup. The robbers made their getaway in an Impala, and the cops took off after them in a Bel Air police model. So they named the bank, as well as the Maryland town where it was located, Chevy Chase.
I'm going to miss telling people that story!

Posted by: dergans76 | December 4, 2008 5:29 PM | Report abuse

Speaking of ATM charges, though, Chevy Chase had some of the most punitive for non-bank customers.

Having been screwed by them several times when no other options were available, I could not be happier to see the company take a dirt nap.

Plus the Ben Franklin commercials were TERRIBLE.

Posted by: JoeSchmoe06 | December 4, 2008 7:17 PM | Report abuse

If you live long enough you see banks come and go. We started with what we considered a neighborhood bank in Potomac, which changed its name at least twice before it morphed into Bank of America.

Posted by: OldLady1 | December 4, 2008 11:31 PM | Report abuse

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