When somebody broke into the storage bin of Challenger Little League, a league for handicapped children in Lynn, Richard Holbrook, COO and president of Eastern Bank, saw the story in the paper and wanted to help. The Challenger Little League did not have the financial resources to replace its equipment, so the Eastern Bank Charitable Foundation came to the rescue, donating $5,000.
To those familiar with Eastern Bank, the donation was no surprise. A mutually owned bank in Lynn, Eastern is committed to supporting its community. What attorneys might find especially interesting about Eastern’s philanthropy, though, is its decision to include its treatment of IOLTA accounts in its charitable vision.
“We’ve always had this underlying philosophy that we were there for the betterment of the community, and particularly for our costumers who are members of that community,” says Holbrook.
“But it’s not totally selfless.” he says. “It’s also good business.”
The way Holbrook sees it, the community prospers from the support of the bank while the bank cultivates a good reputation and attracts business.
Similarly, Eastern ensures a competitive rate of return for IOLTA accounts because interest from IOLTA accounts funds charitable organizations and because there are substantial benefits for the bank. Holbrook describes Eastern’s involvement with the IOLTA Committee as a “great two way street.”
“We have made a commitment to make certain that IOLTA funds that are placed on deposit by attorneys receive a reasonably good rate of return. The interest we pay on those funds ends up going back to more charitable organizations,” Holbrook explains. “But at the same time, it’s good funding for us. We develop better relations with attorneys and, quite honestly, it helps us fund loans that we can make for people to buy houses and to grow their businesses.”
Interest from IOLTA accounts is distributed to the Massachusetts Bar Association, Boston Bar Association and Massachusetts Legal Assistance Corporation to support civil legal aid for low-income people and improve the administration of justice. Two hundred banks participate in the Massachusetts IOLTA program, and Eastern Bank’s rates are among the highest, says Jayne Tyrrell, executive director of the IOLTA Committee.
“The growing cooperation of banks like Eastern Bank helps us ensure that critical legal services will be available to meet the day-to-day- legal needs of battered women, elders, disabled people and the poor,” Tyrrell says.
The foundation and generous interest rates for IOLTA accounts are not the only way that Eastern Bank does charity work. When a new employee is hired, he or she meets with Holbrook or CEO Stanley Lukowski to discuss the values of the bank. Charity and community involvement are emphasized, and the new employee is urged to get involved in a community cause.
“We encourage them all to find something of importance to them to get involved with,” says Holbrook. “It’s all part of what we think makes us the kind of bank that we are.”