How Bank of Labor powered an industry sea change

Bank of Labor’s short film featured interviews with lobster fishermen and union representatives.

With a single loan, Bank of Labor in Kansas City, Kan., changed the lives of a group of lobstermen in Maine, more than 1,500 miles away. The community bank even made an award-winning short film about it.

By Margaret Littman

It was clear something had to change. A group of lobstermen were waking well before dawn and coping with storms and other unpredictable conditions to trap lobsters, only to get back to shore and have wholesalers determine the prices they would pay for the lobsters the lobstermen had caught.

After years of debate, the lobstermen organized, and, in 2013, they became a union. They began looking for financing to purchase a lobster wholesaler, including the lobster pound and trucks. But bank after bank in New England declined to lend to the new lobster union.

“They did not want us in the game because we have proven to be a game changer,” says Dave Sullivan, the Grand Lodge representative for the Eastern Territory of the International Association of Machinists and Aerospace Workers (IAMAW) and the union rep who helped the IAMAW Maine Lobstering Union–Local 207 (IMLU) reinvent its industry. He estimates that 70% to 80% of income generated in the state of Maine comes from the sea.

After the union’s loan application had been turned down by a number of banks, prospects didn’t look good. Then, while Sullivan was at a conference in Las Vegas, he heard a presentation from $600 million-asset Bank of Labor in Kansas City, Kan. Staff from the community bank didn’t know much about trapping and selling lobsters, but they did know a lot about lending money to labor unions. So, in March 2017, the two parties inked the deal, with Bank of Labor financing the lobstermen’s union.

“The surprising thing I learned about the lobstering business is that it is similar to agriculture and livestock,” says Joe Keller, the bank’s senior vice president and manager of Labor Bank operations. “One is in the ocean and one is in the middle of the field, but they are similar. For something like this to happen, there has to be a need. There has to be something wrong in the industry or else it never could have been accomplished.”

Bank of Labor wasn’t specifically marketing to lobstermen that fateful day in Australia, but it was marketing to unions. “All unions are fighting to expand their membership, and when we put this financing together, we thought, ‘What a great story,’” says Keller, the loan officer who worked with the lobstermen.

“If a bank understands the niche it is trying to do business with, and if the customer’s needs fit in with your core customers, it might make sense to think outside the box.”
—Joe Keller, Bank of Labor

Lobsters on film

The two parties were so satisfied with the arrangement that Bank of Labor contracted with Wide Awake Films in Kansas City, Mo., to make a five-minute documentary-style film about the relationship. The film, “Lobstermen,” went on to win an award from the International Labor Communications Association and a Bronze Telly Award; Telly Awards are given to producers of video and television across industries.

“The lesson here is that the little guy can win,” says Shane Seley, founder and producer of Wide Awake Films. “There is a lesson in the power of a union. That is the void that the Bank of Labor is filling.”

The response to the film has been positive. “It makes union leaders think outside the box,” Keller says. “They see there are possibilities beyond their specific trade.” He adds that he’s heard of similar labor groups considering their own industry transformations.

“The film promoted what we were doing and promoted it very well,” Sullivan says. “It was new and innovative for all of us. In the beginning, I wasn’t really sure what we could do to positively affect the fishermen and the industry. The coastline is very long and rugged; you can drive for hours and not pass another car. Cell phone [service] is a luxury in some places. I didn’t know if we were going to be able to get everyone together.”

While the story showcases Bank of Labor’s specialty with unions, Keller believes there are lessons in the film for community banks of all kinds. “If they really know their customers well, things like this are possible,” he says. “We all get in a rut. Customers come in and ask us for a whatever loan, and we do it. They say, ‘We want to build a warehouse.’ and we say, ‘Fine.’ But if we ask, ‘What is it that your company really does? What will the warehouse allow you to do?’ then we can understand and grow in sometimes unconventional ways.”

Being a union bank is a niche, Keller adds. “We never dreamed to finance a lobster distribution center. They are in Maine; we are in Kansas. If a bank understands the niche it is trying to do business with, and if the customer’s needs fit in with your core customers, it might make sense to think outside the box.”

Margaret Littman is a writer in Tennessee.