21 responses to Bank of Bird-in-Hand: First New US Bank in 3 Years
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    Comment on Bank of Bird-in-Hand (December 4th, 2013 at 07:35)

    Bank of Bird-in-Hand

    This is exciting news….and answer to your question, we prefer Credit Unions; Mainly because they do not have so many “FEES” as the banks do, and have a lot of free services for us “over 65” age group. We belong to one in our small community, and they are always there to help us out, with car loan, or banking services, plus they know you “by name”, when you walk in or use the drive-through. Guess that is the hometown feeling you get with dealing with a local credit union, rather than the larger financial institutions. We tried the “other” Banks, but we always come back to Credit Unions, when we have relocated to another city/town–which is not too many times.

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    Teresa K
    Comment on Bird In Hand Bank.....not just for Amish (December 4th, 2013 at 07:54)

    Bird In Hand Bank.....not just for Amish

    As a 25 year veteran of commercial and retail banking in and around Lancaster County, it will be interesting to watch how this bank evolves. First thing to note is that several of the management/investor team of BIH Bank did exactly the same thing a number of years ago – started a small local bank which catered to the plain community – and sold it to a large regional bank, much to the chagrin of the community it served. Many of their former customers migrated to the few remaining small banks in the area.
    Some reasonable distrust is still felt throughout the plain community, so the start up may not go as easily as one might think.
    Another relatively new issue that BIH will face is increased regulation which eats away at the bottom line, forcing banks to charge fees for services (or higher rates) that were not previously charged. In addition, this bank will need to ensure they are not marketing strictly to the “Amish”, as that would be a violation of regulatory standards. They must market to the entire community and offer products and services that are not exclusive of any segment of the market demographic.

    • Very interesting Theresa. I was aware of that sale but didn’t consider the repercussions. I wonder if they have done anything to counteract the distrust you mention, such as voiced intentions in the community to keep the bank local and small.

      I just added a couple of recently-taken reader photos of the bank since this first posted. In the second you can see the parking situation indicates they are open to both buggy and non-buggy customers 🙂

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        Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 4th, 2013 at 22:31)

        I think the local concerns about the group of Amish investors is that they as with the previous bank, they will use the promise of a small, local, plain community-backed bank to elicit the required trust for folks to switch banks and if that is successful, they can sell the bank for a significant profit. Some of these folks became very wealthy off this process a few years ago.

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    Comment on Why not a CU (December 4th, 2013 at 09:49)

    Why not a CU

    Hi Erik.

    Interesting post.
    Any idea why they didn’t create a credit union instead of a bank? The money earned would go back to the members. …

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      Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 4th, 2013 at 12:17)

      They aren’t in the business to give back to the customers. This is a money making operation, and when a big buyer comes along this bank will probably also be sold. A group of Amish investors who have raised 17 million didn’t do it by giving the profits to their members.

      • It’s a good point…it’s a business, one which is meant to bring value to its customers. But Amish businesses in general are just that, profit-making operations which benefit individuals and individual families (not that those profits don’t often benefit others in the community in indirect ways, ie through church alms or by leading to business expansion and employment opportunities).

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    Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 4th, 2013 at 11:29)

    I bank in both a credit union and a local bank.. I have no fees at all at either, Im known at the Credit Union because I go into it whereas I only do online or drive-thru banking at the local bank. However, M’honey has been banking at the local bank for 30+ years and they all know him by name and he them. I think its what you immerse yourself into more than anything.

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    Alice Mary
    Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 4th, 2013 at 11:45)

    I used a credit union via my job for a few years, but it was about a half-hour’s drive away (inconvenient), so I pulled out and put my $ in a local, small community bank (it has 3 or 4 branches in nearby towns, but is very small-townish-they know me when I drive up or walk in). I’ve had accounts there for over 10 years, and have free checking & only pay $10 a year for a small safety deposit box! They have various free seminars a couple of times a year as well as a “community cookout” one Saturday in the summer. This is the first bank (other than the one in Chicago where my mother worked after my Dad’s death–the president was a friend of Dad) that I’ve ever used that was THIS friendly and didn’t charge an arm and a leg in fees (I pulled out of 2 local banks who went crazy charging fees in recent years.)

    It seems, though, that maybe opening a credit union might have been a better option for this Amish bank, but I hope you’ll keep us apprised of their success (hopefully not failure), Erik.

    Gotta love the horse & buggy drive-up service (I wonder who gets to “pick up” afterwards?)

    Alice Mary

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      Comment on Not a fair comparison (January 13th, 2014 at 15:23)

      Not a fair comparison

      What seems to be overlooked in the thread comparing credit unions to this new commercial bank, is that credit unions do not pay federal income taxes and they are regulated by the National Credit Union Fund, not the FDIC or OCC. Their regulatory burden is much lower (my impression having been in the industry for 40+ years)from a cost standppoint.
      So, unless your credit union is saving you 15-20% on your Banking fees and loan interest charges or paying you 15-20% more on your interest, they are ripping you off!

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        Comment on Credit Unions (January 13th, 2014 at 21:21)

        Credit Unions

        That may be true, but this one credit union I joined in Ohio, was promoting a loan program, but when I applied, they wanted me to put 3000 dollars in the account in order to loan me the 3000. If I had 3000 I could have bought the car in cash, and not need any loan. I have bought a few properties on Land Contract and Cash. My credit rating is not worth anything, but I would not need “credit” unless I plan on buying something that is vary expensive, and I have not saved up for it. I say, if it is worth having, it is worth saving up for.

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    Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 4th, 2013 at 15:54)

    Wow! That does not look like a bank, especially in my area.
    It certainly looks very nice, I hope it will stay that way…

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    Comment on This is interesting to me. (December 5th, 2013 at 00:47)

    This is interesting to me.

    I am a member of 2 Credit Unions, 3 if you count the joint membership with my wife in a CU from her former employer (a teachers CU). The one that I have done the most business with though was the first one I ever joined; when I went to work for my first employer in my industry some 33 years ago. I stayed with them because they were like family. In the days before caller ID existed I could call down there and they would know who I was by my voice alone!

    Unfortunately, the parent company of the firm I worked for and also the sponsorship of the CU has changed a couple of times in the last 20 years and things at the CU gradually became less “family” and more “business” in the process. In the latest merger the new corporate entity announced that they had no desire to sponsor a CU, so the CU went out and found a larger one to merge with. All semblance of a family organization has vanished. Now every time I talk to them it is about trying to find some service to sell to me. When our current car loan pays off next July I am going to close my accounts with them.

    On the other hand, when we moved to our town almost 29 years ago we settled on the locally owned, state chartered bank named for our county & were happy as could be with them. After about 15 or 20 years, they sold out to an intrastate bank chain and the local folks continued to run it with little or no change. That lasted for about 7 to 8 more years and then that whole chain sold out to a large chain from the west coast. Won’t mention their name, but their logo is a stagecoach and they got started hauling gold in the California gold rush! While I can’t say their service is bad; virtually every transaction is about what they can sell to me. I finally got sick of it and when the same folks that ran our original bank opened a new bank with the same name as the original we moved our accounts down there. Now every time we go into their lobby it is like a family reunion and there is NEVER any pressure to use their services.

    Maybe some people are impressed with all the bells and whistles that a large national bank can offer; I am not. I much prefer the “Cheers” approach to doing business. You know; one where everybody knows your name!

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    Ed from NY
    Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 5th, 2013 at 13:06)

    This is fascinating. I do wonder which ownership structure they chose: mutual ownership or corporation? State charter or federal charter? And did their Amish beliefs influence this decision? For that matter, what is the Amish viewpoint on usury, did they ever shun loans for interest, as some Christians at one time did?


    I’m a member of a credit union through my work, it is convenient but the service is rather lackadaisical. Mortgage loans, for instance, are not even underwritten by the credit union itself but instead farmed out to an out of state organization with a toll free number. Not very helpful. All things considered, I would most prefer to deal with a small local bank, and if I lived in Bird-in-Hand, this new bank would have my business. I wish them well.

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      Comment on I think that is common. (December 5th, 2013 at 19:52)

      I think that is common.

      Ed, I think that generally banks and mortgage companies, for the most part, resell the mortgages that they have written. If my understanding of the situation is correct that was part of the problem with the mortgage melt down in the 2007 – 2008 era.

      Banks and other loan “originators” were operating under the “make it happen” guidelines (which I am led to believe were, ahhh, … “encouraged” by the federal government) to put as many people in homes as they possibly could. They (the banks) really didn’t care if the people applying for the loans couldn’t possibly qualify under ordinary circumstances, because if the home owners defaulted on the loan it was going back to Fannie Mae and Freddie Mac … not back to the bank itself.

      No big surprise that millions of new mortgages were written, many that probably had ZERO chance of ever being paid off, and also no big surprise that as soon as there was a little slow down in the economy the defaults start rolling in, which further depressed the economy & housing prices … which then turned the default rate into an avalanche of defaults. I am told that this was the real basis of the economic meltdown in late 2007 & on through all of 2008 and still lingering to some degree today.

      At least that was how I interpreted the way it was explained to me by an old friend who is in that industry. Someone with some better insight might clarify if I am seriously off track here.

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      Comment on Amish and Interest on Loans (December 9th, 2013 at 07:52)

      Amish and Interest on Loans

      Ed, not sure on the bank structure here, but on the idea of usury, Amish loans generally do bear interest. However interest may be lower as in the case of funds common in a number of Amish communities which are designed to help the young purchase homes or start businesses. And some may in fact be provided without interest (this may have been more common at one time, I’m not able to give a good history/background of this practice without looking into it further).

      In the programs set up in larger communities, typically they offer below-commercial interest rates. One reason given for that is low overhead, another may simply be willingness of lenders to receive lower interest rates as a form of mutual aid. Here is a description of such funds in Indiana:


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    Comment on Everence (December 5th, 2013 at 22:55)


    Everence Federal Credit Union is a Mennonite and Anabaptist financial institution with offices in 8 or more states, including Lancaster County.

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    Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (December 8th, 2013 at 13:36)

    “Open house today at Bank of Bird-in-Hand, the first community bank to open in 3 years in this country. Got a private tour with my friend and chief loan officer, Bill O’Brian.” – Ira Wagler, NYT Bestselling author, “Growing Up Amish”. http://www.amazon.com/gp/product/1414339364/ref=as_li_ss_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=1414339364&linkCode=as2&tag=xamishcom-20


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    Comment on Bank of Bird In Hand Here For the Long Haul (March 13th, 2014 at 12:10)

    Bank of Bird In Hand Here For the Long Haul

    I just now came across this article and the related comments which I found very interesting. So lets answer some of the questions.
    First off, Bank of Bird-In-Hand was established to serve the Community of Bird-In-Hand and its surrounding areas. Not an Amish Bank….. Only 42% of the investors are Amish so by no means a majority. With that being said, the original majority of the bank organizers were Amish and they set out to establish the bank because they were unhappy that the previous bank they helped start in 2000 got sold to a large bank that does not understand the needs of their community. I refer to this as Big Bank Stupid….. Big banks don’t understand community and people, they understand bottom line profits. Measures have been taken this time around to ensure that same scenerio will not be allowed to happen with Bank of Bird-In-Hand. This Board of Directors is dedicated to ensuring the survivability of a small community bank that will serve the needs of its community, cherish its employees and rewards it’s shareholders with a fair return on equity through sound banking practices for a very long time.

    From a regulatory standpoint because we are State Chartered and are only $35 million in assets, we fall far below the radar in terms of additional regulatory and financial burdens. We will be under DeNovo Bank status for 7 years though which means we can not deviate from our approved Business Plan without permission from FDIC and PA State Dept. of Banking.

    Bank of Bird-In-Hand has now been open for a little over 3 months and we have seen our asset size more than double and are on target to meet our 1st years loan goal in just 4 months. Again customer base is only about 40% Amish so the bank has been well embraced by the entire community which we knew we would be. This is not our first time doing this so we know what it takes to run a successful small community bank and we are very excited to be serving the community of Bird-In-Hand and the surrounding Lancaster County Community once again.

    Will try and keep everyone updated on the banks success. As mentioned in one of the comments, Bank of Bird-In-hand is the first bank in the US to gain FDIC approval in almost 4 years and the first in PA in almost 5 years. I do not believe this is the start of DeNovo Banks getting approved on a regular basis. We got lucky! Right people, proven business model, great location and lots of start-up capital 🙂

    Todd Newpher
    Bank of Bird-In-Hand

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    Alice Mary
    Comment on Bank of Bird-in-Hand: First New US Bank in 3 Years (March 13th, 2014 at 14:19)

    Thanks for the update, Mr. Newpher! I was just thinking about your Bird-in-Hand bank recently, so I’m glad to hear things are going so well for you there!

    I’m still quite pleased with my own small, hometown bank, and find it interesting that a big bank I USED to keep my savings and checking in (which then went crazy charging fees…and I pulled my $ out) is now spending $$$ on expensive (I’m sure) commercials saying how “friendly” they now are. Too little, too late!

    Best of luck to the Bank of Bird-in-Hand! Should I ever be in the area, I hope to stop by and say hello!

    Alice Mary

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