Jim MacPhee Reflects on Life as a Small Town Banker

macphee 1By Sue Moore

“When no trucks were moving along US 131 past my office window at Kalamazoo County State Bank (KCSB), I knew something was happening to our economy that wasn’t good,” Jim MacPhee told people in the banking business in 2007. He was prescient about the collapse of the banks and the economy that took place in 2008-09, for which the country is still trying to recover from, he said.

MacPhee is retiring from KCSB, his banking home for 43 years.

“The trucks with big loads will rattle the windows in my office, so I know when they aren’t coming by very often. When the [market] collapsed, we just had to hunker down in the bank as it was no time to take chances,” he told his staff. “We can’t save the world, but at least we can help the ones we know right here in Schoolcraft, Vicksburg and Mattawan. We only had five residential foreclosures from 2005 to 2012. When people did get in trouble, we tried to help them look at their budget and see how they could get back on their feet.”

“This business is about safety and soundness,” he said. “When we hang that sign outside that says we are a bank, it says your principal will be safe and sound, but that doesn’t mean we can predict what your interest rate might be.

We were tested hard during the recession, but we take great pride in how we were able to survive and flourish,” MacPhee said. “We are relationship based in the community banking world, whereas the banks that are too big to fail are all transactional in their business model. We live with our customers and if we treat them right, we can help them reach their financial goals. If we don’t, people out in the community will know it in a hurry. It’s about community, and taking care of each other.”

His influence in the banking world has led MacPhee to testify in the halls of Congress, and speak with both Presidents George W. Bush and Barack Obama about the challenges community banks face across the nation. “Today as things are picking back up, we are sitting here with lots of liquidity and money to loan. I see a big difference with how careful people are being with their money. But I’m seeing some warning signals on the horizon with how the housing market is acting. There are pockets in the country where houses are being flipped three and four times in just the last five years. This is cause for concern.”

Retirement doesn’t mean he will become a couch potato. He sits on four boards of directors and was just appointed vice-chair of KCSB’s board. He worked through the various chairs of the Michigan Community Bankers Association; that led him to the national organization, The Independent Community Bankers of America, where he served with distinction. “You can be a big fish in a small pond, but it’s a big world out there on the national level. My contacts became very useful as it helped our bank to know what things were coming down the pike and kept us ahead of the bubble. Actually, I was told that they elected me to the seat on one of the boards because they really voted for my wife, Judy, and got me instead. She just lights up a room as she is so outgoing and friendly.”

MacPhee knew Judy in ninth grade. Both went to Portage schools and graduated the first year Portage Northern was opened in 1966. They have been married 48 years. Before he got married, he volunteered for the draft right out of high school and spent two years in the Army. He returned to Kalamazoo to look for a job and answered an ad in the Kalamazoo Gazette for a debt collector at Beneficial Finance. “It was just pure dumb luck that I ended up in the banking business. Judy was working at Industrial State Bank and her boss needed a body in the automobile loan department where I worked for three years. In those days it meant that Judy had to find a job at another bank because married people couldn’t work together. She went to American National Bank.

The next step was a big one, MacPhee saw an opportunity to learn the whole business of banking at KCSB beginning in 1972. He moved up to CEO in 1991 and never looked back. He did need to further his education on the GI Bill, first at KVCC, then the American Institute of Banking and finally at the University of Michigan Graduate School of Business with a two-year accelerated certification program in bank management. “This was the road less followed for most bankers, but it has been my particular hands-on school of hard knocks. I have been blessed to work in a community I love, in a job I have loved, and with people that I have loved over these many years.”

MacPhee will end his career at KCSB and hand the reins over to Scott Hines, newly-appointed CEO of KCSB.

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