Completely obliterating critics of the nation's only Public Bank, the Bank of North Dakota (BND) achieved its 12th year of record profits. Summarizing this accomplishment, the BND writes :
In its 2015 Annual Report, Bank of North Dakota (BND) reported its 12th consecutive year of record profits, with $130.7 million in net earnings. Total assets increased from $7.2 billion in 2014 to $7.4 billion in 2015. BND ended the year with capital of $749 million. The state's return on its investment at the Bank was a healthy 18.1 percent.
Return On Investment (ROI) of 18.1% - without risky derivatives,
out-of-state/out-of-country investments, securitization to naive 3rd parties -
is something the Too Big To Fail banks can only dream of. And the BND has been
getting returns like this for years, well before the post-2005 period when
fracking began to push natural gas production to record levels in the state.
But still, many critics - on both the Right and Left, were skeptical of this deep Red State's bank with socialist roots in the now defunct Non-Partisan League , from its founding in 1919. Even when the bank celebrated nearly 100 years without a major scandal, while the major American banks were, and are, racking up billions of fines , year-after-year, some people and the mainstream media thought it was an anomaly, or a fluke of low population (North Dakota's population as of 2015 is: 756,927 , making it the 47th state by population. Other oil-rich states Alaska, ranked 48th and Wyoming, ranked 50th, have about double the rate of unemployment and lower rates of growth).
The Bank's lending portfolio grew by $486 million 2015, a 12.7 percent increase. The loan portfolio experienced growth in all four areas: agriculture, business, residential and student loans.
Note the conspicuous lack of lending in the oil sector. Though some local businesses do benefit from the economic effects of the oil and gas business, it is primarily the out-of-state big banks that lend to the large interstate oil and gas companies. And in any case, even at the peak of the oil & gas boom, it was the state which, rightly, collected the economic rent from those resources from the commons. Now, it's the state's turn to distribute some of those earnings, during the down times, while the BND continues to play its part, returning dividends to the state, including over $300m in one recent 10-year period, when the state's population still averaged less than 700,000 people.
In 2012, the National Council of State Legislators (NCSL) counted 20 bills in 15 states to create a State-owned Public Bank. Since then, other states, cities, and even some moderate-sized towns, have pursued the creation of Public Banks. The current author has been a member of the Public Banking Institute (PBI) as the New York State Coordinator since 2010, and has helped in efforts to create Public Banks in New York (including multiple presentations on Public Banking and related reforms), Pennsylvania , Arizona, Vermont, New Jersey and several cities and counties in New Jersey, Florida (at the request of a third party candidate for Governor), California, California cites such as Oakland (where a major effort was made to put together a spreadsheet and future article detailing how ANY state or municipality can create a Public Bank, currently under review by the PBI's banking advisors).
Public Banks are neither Right-wing nor Left-wing political solutions, they are just People Solutions that work.