ROCK OF AGED.

AuthorAdams, Jerry
PositionBank of Graite - Company Profile

At 83, John Forlines still isn't ready to step down as CEO of Bank of Granite. After all, his heir apparent is only 67.

John Forlines doesn't understand why anyone would call him a tightwad -- "I prefer frugal," the 83-year-old chairman and CEO of Bank of Granite offers -- even though he's heard all the stories. He probably started most of them.

Like the one about not returning long-distance phone calls unless there's a toll-free number to dial. True, he admits, but only when the caller is trying to sell him something. Or about the bank doing its annual report in-house on a desktop computer. That was several years ago, he points out. "We do use an advertising agency now.

Or about his car. "One time, a guy came down here and did a story and talked about the car I drove, which was then a Buick, as if that were a Ford or Chevrolet." The writer -- "for Forbes or one of those magazines" -- thought Forlines should be driving a Lincoln or Cadillac. "Lord, I wouldn't even think of that." He drives a '99 Park Avenue. "We've got a good arrangement with a Buick dealer here who does all his banking with us. That's why I drive a Buick."

Forlines relishes his bank's reputation for frugality, just as he relishes retelling the stories for TV networks and national publications. But he can be as tight-lipped as he is tight-fisted. Just ask him about who'll succeed him. "To be frank," he says, laughing off the question, "we've never discussed that."

Even if that were true -- and Forlines later acknowledges it isn't -- others talk about it. "My concerns are two," says John Moore, an analyst with Wachovia Securities Inc. in Charlotte. "Can small banks like the Bank of Granite survive as the industry continues to move away from that sort of practice? And, second, my concern is whether the Bank of Granite will outlast John Forlines."

Forlines has run what Warren Buffett has called "the best bank in America" since 1954. Operating out of Granite Falls, a town of 3,900 between Hickory and Lenoir that is off a road (U.S. 321A) off a road (U.S. 321) off Interstate 40, it has just 14 offices in three counties. But, year after year, it puts up some mighty impressive numbers.

In January, the bank, with $661.6 million of assets and $517.3 million of deposits, paid its 189th consecutive quarterly dividend -- 11 cents a share, up a penny from January 2000. The year was the 47th in a row of increased dividends. Its return on average assets, a ratio that banks work hard to get in the neighborhood of 1.5, was 2.45 in 2000, the 15th straight year it had exceeded 2.0.

The $15.6 million annual and $4.1 million fourth-quarter earnings were the best in the bank's history. In his end-of-the-year message, Forlines, who owns 4.78% of the stock and was paid $280,700 in salary and bonuses, said: "These earnings, which are indeed exceptional, were accomplished during a period of slowing business activity and volatile monetary conditions."

While Bank of Granite was breaking records...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT