New England’s first new mutual bank in decades is seeing strong growth after a little over 12 months in business. iStock photo

Walden Mutual Bank’s business model is proving to be sustainable in more ways than one.

The Concord, New Hampshire-based, largely online institution, which focuses on sustainable food and ag-business lending, has seen explosive growth since digitally opening just over a year ago, growing its assets from about $24 million to about $90 million today, according to its founder.

And Walden Mutual, the first mutual bank to open in 50 years in the U.S. and the first to open in nearly a century in New Hampshire, hopes to grow to “hundreds of millions” in assets in coming years, says Charley Cummings, CEO and founder of the bank.

One of the sources of the bank’s first-year success: individual and commercial depositors who believe in Walden Mutual’s stated mission of lending to regional farmers and agricultural entrepreneurs committed to producing sustainable food and ag-related products.

“These are people who are pretty passionate about the mission,” said Cummings of his bank’s average depositors. “Their passion affords us a little more latitude and grace to pursue [sustainable lending goals]. Our hope is to attract missionaries, not mercenaries.”

$50K to $5M Loans

To date, Walden Mutual has lent out about $50 million to various farmers and agriculture-related businesses, mostly in New England and New York State.

The bank’s portfolio includes financing for a number of Granite State entities, but it also boasts loans to help Vermont wineries, Connecticut dairy farms, a Massachusetts shellfish hatchery, New York flour mills and Rhode Island meal companies. Among others, the bank also lists current and potential loans for beef farms, granola makers, pasta producers and other firms.

Walden Mutual does make occasional loans to non-food producers, such as Gilsum, New Hampshire-based W.S. Badger Co., maker of organic skin-care products. But Walden Mutual’s main mission is and will remain focused on food- and ag-related businesses, said Cummings.

The average size of Walden Mutual’s loans range from $500,000 to $1 million, though the bank has lent out as little as $50,000 and as much as $5 million, said Cummings.

Word-of-Mouth Fuels Deposits

Cummings, who previously founded Walden Local, a Massachusetts-based seller of sustainably raised meat, said overall first-year loan activity at Walden Mutual is a little slower than he had expected.

“The sales cycle of loans is a bit longer than it is for deposits,” he said. “But we’re very optimistic.”

Indeed, one of Walden Mutual’s goals, and expectations, is to become profitable by the end of 2024, he added.

As for overall deposits, they’re “roughly on plan,” said Cummings.

To date, the bank has relied mostly on word-of-mouth to attract depositors, though it has engaged in some online marketing, he said.

“We’re doing a little digital advertising, but the lion’s share [of deposits] is coming from referrals,” he said.

Though Walden Mutual offers checking and saving accounts at competitive rates to individual depositors, it doesn’t offer consumer loan products such as home mortgages, he said.

To maximize asset levels and the bank’s ability to finance sustainable entities, Walden Mutual urges its mission-driven customers to view their deposits as savings accounts.

“It’s a place to put your savings,” said Cummings.

In all, Walden Mutual Bank has “several thousand” deposit accounts, split between consumer and commercial depositors.

Another B-Corp. Bank

Walden Mutual’s emergence on the banking scene comes amid a surge in recent years in the popularity of sustainable development and socially responsible investing in general.

Walden Mutual, a certified B-Corporation, is clearly tapping into the growing social-values movement.

Susan Kaplan, owner of Sustainable Futures Consulting in Lebanon, said there are two other certified B-Corp banks in New Hampshire – Piscataqua Savings Bank and Mascoma Bank. And now there’s Walden Mutual.

“It’s fantastic,” she said of Walden Mutual’s sustainable focus. “The whole New England region, we need more support for local food and agriculture.”

Kaplan said the bank’s launch also comes as the state’s 23 certified B-corporations – which are for-profit firms that have received certification that they’ve incorporated certain social and environmental standards into their bottom lines – are in the early stages of trying to form a new business group that can represent the interest of socially-conscious companies across New Hampshire.

She noted that Walden Mutual Bank’s strong financial start indicates the resiliency and promise of B-corporations in general.

“The mission of B-corporations matters to me and many others,” she said.

Aiming High

As for Cummings’s goal of growing Walden Mutual’s assets by hundreds of millions of dollars within a few years, government filings suggest it’s more than a pipe dream.

In its 2023 fourth-quarter filing with the Federal Insurance Deposit Corp., Walden Mutual Bank reported total assets of $75.6 million (a figure that has since grown to about $90 million, Cummings said) and 13 employees.

By comparison, Springfield-based New Valley Bank & Trust, which opened in the spring of 2019, reported total assets of $333.22 million and 33 full-time equivalent employees as of Dec. 31, 2023.

Walden Mutual’s first-year financials certainly indicate a similar growth pattern.

Besides providing loan funds, Cummings said Walden Mutual helps farmers, ag entrepreneurs and other borrowers connect with potential partners, distributors, marketers, suppliers, investors and others who can assist in growing their businesses.

“That’s a huge value-add,” Cumming said of Walden Mutual’s unofficial advisory services.  “We’re putting them in touch with others who can help them.”