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Banking Physics

Thursday, April 23, 2020

Banking Physics

In physics, invisible and powerful forces are always at work which are awe inspiring and often mind bending.  Great scientific minds have solved complex theorems and challenged the applications and relationship of matter and energy.  Categorized into 11 different branches of physics, scientists have discovered so much, yet, have infinitely more to achieve.

With these particular thoughts in mind, I couldn’t help but also correlate to today’s world crisis that is COVID-19.  This thorny looking virus, invisible to the eye, has put into place powerful forces with enormous human and financial impact.  No one person or company is immune to either impact.  Every household and business is managing to what we know right now, offering support to others and a human touch in ways that are not physical, and anticipating and planning for a return to “normal”.

Stay with me… I would like to suggest that these forces of nature apply to the forces of banking, à la Banking Physics.  The most famous and influential scientist/individual in modern times is Sir Isaac Newton.  Amongst his countless contributions as a scientist, theologian and author, his most well-known concept is Newton’s Three Laws of Motion. As I have thought about our current personal and business environments during the COVID-19, I keep coming back to Newton and these Laws.  

Every object in a state of uniform motion will remain in that state of motion unless an external force acts on it.  This reminds me of the past several years, those without crisis—what is, hopefully, around the corner again—and the feeling of business as usual, enjoying the steady times, and managing through the inevitable but controllable “blips”. Certainly, “business as usual” will have a different look and feel post COVID-19, of which we will all ultimately enjoy and value.  

Force equals mass times acceleration.  In comparison to today’s complicated algorithms and Excel spreadsheets, this 5 word equation is a walloper! Consider these word substitutions: Shelter-In-Place = The World times 60 Days. For First Merchants, this translates to dramatic changes in methods to deliver service to our clients in an immediate fashion, without precedent.  Within short order, we were able to shift delivery models across all facets to 80% remote and not miss a beat along the way.    

For every action there is an equal and opposite reaction. Shelter-In-Place. Limited, or in some cases, Paused Business Operations. Market Volatility. Human Concern. On their own, impactful.  Together, never yet experienced and impact unfolding daily. As your community bank, we were prepared to respond in an impressive manner.  Increased digital limits to access funds, heightened online logins, and customer service accessibility were implemented and executed. Payment deferrals for business and consumer loans were processed in recognition of financial impact by our clients.  Paycheck Protection Program (PPP) applications were received, which represents 3,600 business clients over a four day period.  As of this writing, 1,970 applications were accepted by the SBA before the PPP funds were exhausted, accounting for $750 million in much needed funding.  We are prepared to forward the remaining applications to the SBA immediately, upon further funding approval by our United States Government.  Daily contact is made to our clients just to say hello and make sure you are OK. All without interruption to what you expect from us on a day to day basis – assist in financing a new home, remodel your current home, open new deposit accounts, financing your dream project, and planning for the future.
We are in the people business and all look forward to connecting with you with a warm, personal greeting. Perhaps meeting over a meal or indulging in a favorite beverage.  One day soon, our houses will transition from a shelter to a home.  Please know that as we move forward together, First Merchants can, has, and will be there for you. 
Thank you, be safe, and be well.
Nancy Leming