Maine bankers on Monday were generally receptive to a Bush administration plan to buy stocks in banks, but some executives expressed uneasiness about the potential for a greater government role in their industry.

The plan for the federal government to take partial ownership in banks is meant to provide the institutions with an injection of capital. Details of the plan, part of the larger $700 billion rescue package for the banking system, have not yet emerged.

“I think it make sense,” said James Delamater, president and chief executive officer of Lewiston-based Northeast Bank. “It’s certainly, at this point, something that’s logical for the government to do, and it will help solidify the markets.”

Maine-based financial institutions are unlikely to be part of the government stock-buying plan. Many of the banks in the state are mutual savings banks that do not have stockholders. Officials in the state’s financial industry say that the institutions have avoided subprime loans that have caused trouble elsewhere.

Edwin Clift, chairman of Bangor-based Merrill Bank, said action is needed but that he is unsure that the government buying equity positions in banks is the best approach.

“I’ve never seen such a thing. To me, it’s almost like heading toward nationalizing the banks,” said Clift, who noted that he has always been in favor of letting capital markets take care of themselves. The bank’s parent company, Connecticut-based People’s United Bank, is a stock company.

William Weir, president and chief executive officer of Bar Harbor Savings and Loan, said he is always apprehensive when the federal government gets more involved in private industry. That kind of involvement generally means another layer of regulation and additional time and expense, he said.

“Do I think the government’s step is needed? Yes, I do,” said Weir, whose bank does not have stockholders. “But it’s like something where you hold your nose and vote yes.”

Gren Blackall, senior vice president of Gorham Savings Bank, said he wasn’t worried that the plan was the first step toward government takeover of the nation’s banks.

“This is all good. The government is trying provide options, and they’re working very hard,” he said. “They want to have a toolkit.”

Blackall said he is concerned that if the rescue package is successful, both political parties could see government as the answer to any problems in the industry.

“I sure hope we don’t, five years from now, think this is going to be the way for everything. That would be scary,” he said.

Like other bankers interviewed Monday, Glenn Hutchinson was looking forward to seeing details of the plan to better evaluate it.

“I think anything that helps the confidence in financial markets right now are good for financial markets in general,” said Hutchinson, president and chief executive officer of Bath Savings Institution. “It’s a very difficult situation to know whether this would be the magic bullet or not.”

On Monday, the Dow closed up more than 900 points on the combined news of the government stock-buying plan and European governments providing nearly $2 trillion to thaw the credit freeze.

While the plan is expected to have little or no direct impact on financial institutions in Maine, its effect on consumer confidence and the overall economy will be important.

“I think the No. 1 thing is it gives the economy some positive news and that is an absolute help to us,” said Chris Pinkham, president of the Maine Association of Community Banks.

John Murphy, president of the Maine Credit Union League, said that any steps that will calm consumer concerns will be helpful.

“Consumers do remain concerned and cautious in thinking they don’t have the ability to borrow for purchases they’ve become accustomed to when, here in the state, they do,” Murphy said. His organization’s members will not be directly affected by the government plan.


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