Community loses only bank, concern over town covenant - WNEM TV 5

Community loses only bank, concern over town covenant

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GRATIOT COUNTY, MI (WNEM) -

Ann Paksi is upset because the small Gratiot County town of Ashley will soon have no bank.

"That's going to tear us right down. This is the hub of the town," Paksi said. "If you notice people are coming and going from the bank all the time."

In a statement released by Mercantile Back of Michigan, the company announced it would close 5 five locations across the state because of low traffic.

Ashley Township is one of them.

Dave Osborn, who's banked here since Mercantile Bank took over from the last bank, said he feels there has to be other options in order to avoid closing its doors on residents.

“They could open only Monday, Wednesday, Friday to save some money," Osborn said.

Aside from the fact the small town of Ashley will soon have no bank, residents fear that deals made a long time ago could prevent any other bank from opening its doors.

"That's not fair," Osborn said.

A restrictive use covenant was put in place by the previous bank to prevent a competing bank from setting up shop once it leaves the area.

And because Mercantile Bank essentially took over, residents fear that restriction could prevent the small town from ever having their own bank again.

The company’s chief operating officer said, regardless of any restrictions, the company will allow another bank to move in.

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