Gate City expands mission, locations
By Jonathan Knutson
The Forum - 12/18/1999

In 1923 the Gate City Building and Loan Association was chartered in Fargo. Organizers believed that Fargo would become the gate for making home loans across North Dakota.

Seventy-six years later, their faith has been amply vindicated.

Fargo-based Gate City Federal Savings Bank has become the largest originator of home loans in North Dakota. Gate City offers other banking products and services, too.

The company has assets of about $600 million and 21 banking branches in 15 North Dakota communities, as well as a Moorhead branch that opened earlier this year.

Gate City has about 280 employees, 145 of them in Fargo-Moorhead.

“We’re proud that over 76 years we’ve been able to grow and serve customers across the state,” said Bob Anderson, president of Gate City.

The fledgling Gate City Building and Loan Association initially leased space in a downtown Fargo hotel.

The original name has been modified several times. The institution became Gate City Federal Savings Bank in 1986.

Gate City’s strategy was simple: Take in deposits, enter them in passbook saving accounts and pay interest on the money. Then lend the accumulated deposits at a slightly higher interest rate to home buyers.

The strategy worked well enough that assets grew steadily. Gate City moved to 744 Broadway in 1940.

The company has made more than 50,000 home loans since 1923.

Gate City enjoyed one of its finest years in 1956, when the bank moved to a new six-story building at 500 2nd Ave. in Fargo. Press accounts at the time called the building “the last word in modern financial and office structures.”

The building, renovated last year at a cost of $800,000, still serves as Gate City’s corporate headquarters and flagship branch. Gate City occupies about four-fifths of the building and leases the rest to several tenants.

“It has been an excellent home for us and will continue to be for many, many years,” Anderson said.

Gate City opened its first branch in Minot, N.D., in 1957. The positive response encouraged the company to open more branches.

The next addition to the Gate City organization, a Mandan branch, will open early next year.

“We already have two branches in Bismarck,” Mandan’s sister city, Anderson said. “We’re excited to be expanding our service to our customers in Mandan.”

Gate City opened a branch at 305 8th St. S., Moorhead, earlier this year.

“The reaction from our customers and the public has been very positive,” Anderson said.

Gate City operates a branch in south Moorhead as well.

Is Gate City interested in opening other branches in western Minnesota?

“Well, sometimes we’re asked if we have plans to open more branches in Minnesota. At this point, we have nothing in mind. But we’re also keeping an open mind,” Anderson said.

Gate City, like any other business, has had its ups and downs during its history.

The 1980s were difficult for many S&Ls. Savings and loans nationwide struggled with bad loans, and the S&L industry’s reputation was tarnished.

Anderson said Gate City, like most other S&Ls in this area, operated prudently and avoided the worst of those problems.

The 1990s have been kind to most financial institutions. The combination of the strong national economy, falling interest rates and low inflation have meant healthy profits for banks and S&Ls.

Gate City is in excellent financial shape, Anderson said.

Regulatory changes in the 1960s allowed Gate City and other S&Ls to offer more than passbook saving accounts and home loans. Today, Gate City offers pretty much the same products and services as a bank.

“We’re able to serve our customers in any way that a bank can,” Anderson said.

“We’re very pleased to have to the opportunity to serve our customers since 1923. We plan to keep on doing it,” he said.