Current conditions unavailable
First incorporated as a bank in downtown Chehalis back in 1903 with startup capital of $15,000, Security State Bank grew into a regionally successful community bank with 12 locations in Lewis, Thurston, Pacific and Grays Harbor counties.
For 121 years, the bank served customers in these counties, all the way up until last summer when it was announced that Security State Bank, run by the Security State Corporation, had been sold to the Richland-based Gesa Credit Union.
Just over a year after the sale was announced, Gesa Credit Union CEO Don Miller sat down with The Chronicle on Tuesday, July 29, to talk about how the sale came to fruition and what changes customers can expect inside the Gesa Credit Union — formerly Security State Bank — on South Gold Street near the Southwest Washington Fairgrounds.
“(Security State) survived The (Great) Depression. A lot of them didn’t. I think they were the only community bank located out of Centralia that survived The Depression,” Miller said.
Miller has been Gesa’s CEO since 2013, and has worked for the credit union going back to April 16, 1987, as his first job out of college.
“It’s kind of a rarity today that you stay with some place that long,” Miller said.
As for how Gesa came about acquiring Security State Bank, Miller said he wasn’t even looking to purchase it when Security State’s Board of Directors approached him.
“With the changing of the industry, costs, all those things, you know, it’s time to sell,” he added.
The Security State Corporation hired a consultant and set about looking at other credit unions trying to identify one which had values that aligned with their own. Among the banks identified by the consultant was Gesa.
After being contacted by the consultant, both Miller and Gesa’s CFO came down to visit and see what Security State Bank looked like.
“We also did some analytics of our own membership at the time to go, ‘How many members do we have in those communities,’” said Miller.
Based on their own analysis, they realized they already had around 7,000 Gesa Credit Union members who already lived in Lewis, Thurston, Pacific and Grays Harbor counties at the time.
“They asked for branches (in those counties), and we had no branches. So it made sense to say, ‘Yeah, let’s take a real serious look.’ We looked at their financials, met with their CEO and the consultant and just in that conversation, it felt right that what we valued and what they valued aligned,” Miller said. “In fact, the CEO said, ‘Don, the stock holders, myself and the team live in these communities. We want to sell to somebody who’s going to do right by our customers and communities because we live here. We don’t want people thinking we didn’t take care of them.’ That was important to them, and they actually sought us out because of what we do in the communities.”
Here in Lewis County, Gesa already sponsors various local events throughout the community.
Miller stated this was a primary shared value with Security State’s previous owners, who didn’t want to sell to a major corporate bank — which are often uninvolved in small communities or in the case of Centralia’s Bank of America, leave the community entirely.
“That’s where credit unions, and in particular in this case, Gesa, is trying to step in and make sure that doesn’t happen in these communities,” said Miller. “... We don’t want that void to happen in these communities.”
Miller added one of Gesa’s main goals is to make a positive impact in the communities where credit unions are located, which involves more than just making monetary donations.
“Investing in the communities, that’s what we feel we’re called to do,” he said. “We feel faces need to follow dollars. If we’re going to be partnering with the community, our people need to be there too. We don’t just write checks.”
As for what the future will look like for Gesa Credit Union, old customers of Security State Bank may not have noticed any changes yet — but some will soon come as Gesa prepares to transfer banking and customer data from Security State’s old platforms and software to their own.
“At the end of October, we will be moving off of their platforms onto our platforms. So things are going to change a little bit, there’s no way to avoid that as you consolidate. But if they want access to all the other products and services we have, we gotta get everybody on one system,” Miller said.
Since Security State Bank was acquired by Gesa Credit Union, Gesa has also opened up several other locations, bringing the total number of credit unions in its network to 45 according to Miller.
Gesa Credit Union was founded in 1953 and despite being based in Washington state, has members across the nation.
“There’s probably not too many countries that we don’t have some members in, just with travel and relocation in the world,” said Miller. “We’re very committed back to our membership. We want to make sure we take care of them, and then also to the communities.”
For more information on Gesa Credit Union including branch locations, visit Gesa’s website at https://www.gesa.com/.
Family ties
Mike Alexander, a third-generation Alexander working for Security State Bank, is a senior trust officer at Gesa Credit Union, carrying on the family ties of the home-grown operation.
The bank was incorporated in 1903 in downtown Chehalis with startup capital of $15,000. John Alexander Sr. joined in 1910 as president, having left competing bank Coffman Dobson Bank and Trust (today part of Wells Fargo). His brother, J.T. Alexander, joined in 1913 as vice president, and J.T's son-in-law, William Luebke, came in as vice president-bank manager in 1927.
Even at the beginning of the last century, the Alexander family was long-established in Lewis County. The father of John Sr. and J.T., who was of Irish-Scottish background, had homesteaded in the county by the mid-1800s.
Back then, banks accumulated in Lewis County like fast-food restaurants near Interstate 5 today. Between 1884 and 1929, Lewis County was home to 19 different banks. There were few regulations and limited oversight. Many of those banks went out of business during various economic swings, while others were later taken over.
Other banks with insufficient reserves, or those that were too concentrated in the lumber industry, went out of business. By 1931, Centralia had no bank.
The Alexanders and Luebke managed to keep Security State Bank going with a combination of conservative investing and knowing the needs of their customers. It was a rough 10 years, however, until World War II approached. By then, the bank had much of its money invested in war bonds.
John Alexander Jr. attended Brown University, where he studied American civilization, then spent five years in the U.S. Navy. He then became interested in banking, partially through several Navy friends who had found employment in East Coast banks.
He returned to Lewis County and started at Security State in 1962. Though his father was still president, he was no longer particularly active, and Alexander Jr. saw little of him at work. Alexander Sr. died in 1964 at the age of 82.
His brother J.T. died in 1962 at the age of 94, and Luebke died the same year.
The bank survived the inflation of the 1970s, and managed to avoid the mergers of the 1980s.
In 1997, Mike Alexander joined Security State Bank.
•••
Information from The Chronicle’s archives was used in this report.
