The branch has four desks, a coffee machine and a manager who still visits clients at home. Deposits have tripled in two years.

Cooperative and community banks are growing fastest in towns that larger banks have abandoned, offering face-to-face service as their main product.

Relationship banking returns

Loan officers make decisions locally, often after meeting applicants in person. Default rates, they say, are lower than the national average.

“Our risk model is a conversation.”

Can it scale?

Regulators welcome the competition but warn that small lenders are more exposed to local downturns. The banks respond by sharing risk through regional networks.