Remember when Victor Kiam ran ads about his experience shaving with Remington Electric Razors saying “I liked it so much I bought the company?” Well, I’ve observed a recurring theme amongst blog posts, e-magazines, television interviews and industry conversations about the next generation of banks that brought Kiam’s ad to mind. Why? Bear with me. Last week I wrote about Charlie Rose’s interview of Marc Andreessen. My focus then was the Kindle and the demise of paper newspapers (The Rocky Mountain news ran its last edition last Friday…).

Andreessen made another comment that has plagued me like a recurring tune you can’t get out of your head. He said something like this; We shouldn’t fix the banks. The real answer is to create a new generation of banks. He cited Bill Me Later, PayPal’s 4th quarter 2008, $945 million acquisition as a new banking idea that makes sense. Andreessen is on the eBay board so he is obviously a fan of the deal. So am I. Bill Me Later is an instant credit company for online purchases. So, that’s a new kind of bank. And, it has great possibilities.

But, Bill Me Later still takes a traditional approach to obtaining the funds it lends out. Its newness is the instant credit model. Creative in the way it scores and decisions each loan in real time, but traditional in how it sources the money it lends. Prosper.com and Virgin Money are “new” in both the sources and uses sides of the banking function. Virgin has focused on facilitating formal structured loans amongst friends and family, so in a way, they are facilitating lending the old fashioned way with online tools. Propser has created a lending and borrowing commons for the people. Very unique, yet not without its challenges. All three of these companies are harbingers of a new wave of creativity in lending and borrowing.

In short, people are being creative. But, where does Victor Kiam come into the picture? I’m getting closer…The biggest issue in the consumer banking business is tight credit. “Sub-prime” anything is considered out-of-bounds. But, should it be? Are all sub-prime loans losers? What does a person who has marginal credit but a good steady job do when they need to replace an appliance or a car? Good luck. So, reinvent the banks? As a career banker, I believe the basic function of banking is to put excess capital in the hands of those who are in need of capital. It is what a bank is and always will be. Banking is banking, so where is the change we can believe in?

Besides new form factors and ways of speeding up decisions, I believe the emerging major sea change is the face of bank ownership. New owners are stepping in well beyond the Tarp-fund bread lines. Though anecdotal thus far, mounting evidence is pointing to a major shift in the ownership of smaller banks.

Why? Well, one reason is that there are a lot of “ponies” in the sub-prime market that deserve funding and a lot of entrepreneurs who have models for lending businesses that used to flourish with loans from traditional banks. Problem is, these non-traditional, non-mainstream lending concept entrepreneurs need cash and they are being stonewalled by gun-shy bankers sitting on mounds of cash. The bankers won’t provide loans to the entrepreneurs to fuel their lucrative independent lending businesses. And, there is a growing demand for loans with solid risk/return models that is not being met. So, good old American Capitalist ingenuity steps in. It is bubbling and boiling in the most unlikely of places; the community and small regional banking sectors.

I will leave you with a few points of speculation based on my intuition. And, I hope you will throw in your two cents or million bucks and will follow-up with me in the second and third quarters to see who is buying what banks and how they are putting their loads of deposits to productive use. So, here is where I was headed. Thanks for being patient… Like Kiam, shrewd entrepreneurs are saying “I like Community Banks’ idle cash deposits so much I’m buying them.” The new entrepreneurial adage of financial services may very well become, “If they won’t lend it to you, buy their company and lend it to yourself.” A new paradigm in banking?

Bank on it.

p.s. Check it out - Small Businesses Find a New Source for Funding