It’s a rare opportunity to be at the forefront of new and emerging markets, but organizations seizing upon those infrequent chances can enjoy an even scarcer benefit: helping to shape a budding industry’s landscape.
As marijuana becomes increasingly legalized and decreasingly stigmatized at the state level, the business side of the industry grows equally attractive. Parke Bank was one of the first financial institutions in the country to realize its potential, and Lewis Fogg, VP of business development for Parke Bank, the seven-location community bank, knows what kind of a lasting impact early adoption can be rewarded with.
“I think that if anyone were to take an honest, unbiased look at things, they could see that this is the next big thing in banking,” he says. “The companies venturing into this space are kind of writing the rulebook for everything as this goes along. To be part of an organization that has almost been doing this since the ground floor, it was a good opportunity to get in at the right time and grow with an organization that has the knowledge that Parke Bank has in the industry.
That experience attracts business partnerships with other leaders in the field. Curaleaf, which has dispensaries across the country, maintains three South Jersey locations. Christopher LoVerde, Curaleaf’s Vice President of Finance and Accounting, has been working with Parke Bank for roughly four years and has found it invaluable having a team that knows how to deliver exactly what they need.
“For me, the value in Parke Bank is how strong the communication is,” LoVerde says. “A lot of our industry and our business is still very young, so there’s a lot of fire drills and quick, urgent needs and flexibility and pivoting needed, and they really are able to accommodate that for us. If we ever need a cashier’s check sent out the same day, or are setting up new accounts, they jump on top of it and handle that as quickly as possible.”
Fogg says that’s why companies in this still-new business space—not just dispensaries but wholesalers, cultivators and testing labs—trust Parke Bank. And it’s a significant motivator for why Fogg himself joined the full-service community bank this past July.
“The big reason why people choose Parke in this space is because we have a proven track record in not only our compliance quality, but because we’ve already been involved in this for quite some time,” he explains. “We’ve learned a lot of those lessons that people typically do in the infancy stage, and our cannabis banking team has been doing it probably as long as anyone else. It is a big point why I ended up in this organization.”
Staying at the forefront of a new, nontraditional, and always-growing business landscape doesn’t stop at planting one’s flag there. Fogg says Parke Bank “takes a lot of pride” in its active pursuit of information through industry conferences, seminars, attorney insight, “learning how to do things right the first time” and keeping a keen eye on regulatory updates, all of which help the bank remain a knowledgeable, nimble force supporting its cannabis clients. It also means listening to and seeking advice from the businesses that are directly operating in the space.
While medical and adult-use recreational marijuana are seeing increased legalization rollout across the country, the drug remains a Schedule 1 narcotic on the federal level; that, combined with operational laws and regulations that vary state by state, present a range of brand-new hurdles that may affect one location but not another. Having a financial partner uniquely qualified in working with those regionally specific parameters is an essential asset for an entity like Curaleaf, which operates dispensaries from coast to coast.
“With the services Parke provides to better manage our cash on hand with them, having capital readily available and being able to be moved around quickly is something we really value with them,” says LoVerde, adding that Curaleaf essentially has financial relationships with banks in each state its dispensaries operate in. “One of the challenges we face is having too much cash within a certain bank, since they can only maintain so much cannabis-related funding on their balance sheet. We’ve run into issues where they say to us, ‘Hey, we can’t keep this much cash here’—that’s not something that we’ve ever experienced with Parke.”
And, as Fogg says, “An important part of our business is our cannabis compliance team. For a cannabis business that wants someone who knows what they’re doing, I believe that Parke Bank is one of the best in this industry.”
Serving South Jersey