Joe Murphy, president of Bar Harbor Bank & Trust and chairman of the Maine Bankers Association, led the discussion titled “Banking Maine Style: Lending, Investment and Deposit Safety.”

The meeting is part of a series put on by the chamber on “Managing Your Business: Seeking Stability in Unstable Times.”

Maine is in a good place, not just geographically, but fiscally.

Murphy said Maine has low to moderate growth and is not home to “wild speculation.”

“People here are practical and they don’t take unnecessary risks,” Murphy said. “The bandwith of our volatility is narrow.”

Murphy said a recent announcement from the National Bureau of Economic Research states the recession started in December 2007.

Murphy said he takes “some confidence” that the country isn’t just now entering the recession but has four quarters of the recession lifecycle under way.

“The economy’s not going to come back until the consumer comes back,” Murphy said. “We have to control fear. Fear is the worst enemy we have.”

Scott Hammond, chief investment officer for First Advisors, which is the investment arm of The First, spoke about investment safety.

Hammond compared the recession of 1991 to today’s market.

In 1991, real estate prices fell 20 percent and didn’t recover for years after and a lot of local banks that had invested in real estate failed, Hammond said. Banks learned valuable lessons such as real estate prices don’t always go up.

“One difference in this market is the decline in asset values across the whole spectrum,” Hammond said, whereas from 2000 to 2002, a bear market was caused by a collapse in technology stocks.

Hammond said today government is coming into the market in a major way for the first time since the 1930s.

“The government is being very proactive,” he said. In the ’30s, the government waited to see what would happen.

Murphy said the economic conditions in the ’30s worsened dramatically with government inaction.

Hammond said the swiftness and severity of the crisis today is much different from the 1930s because of the complexity of investments and the inter-relatedness of markets worldwide.

“People weren’t sure what they held and how to isolate these bad investments from others,” said Hammond.

“We’re all part of one financial system today,” said Hammond. “Vast amounts of money travel around the world at the click of a mouse.”

Micki Sumpter, the chamber’s executive director, cited the effect of the collapse of banks in Iceland.

“When those banks failed it affected every lobsterman we had,” Sumpter said. Donnelly explained to the group that the Icelandic banks had been the biggest financiers of lobster production. Historically, Maine lobstermen sell 60 to 70 percent of their catch to Canadian processors. Because of the collapse, people can’t get credit to buy lobster.

Jim Donnelly, regional vice president of Machias Savings Bank, spoke about deposit safety.

No Maine banks have failed, Donnelly said.

“We weren’t investing in things that didn’t give unrealistic income,” such as the subprime mortgage market, Donnelly said.

Donnelly noted that the federal government raised the basic limit of federal deposit insurance coverage from $100,000 to $250,000 to settle the market.

He asked the group what the best protection was for deposits.

One woman called out, “the mattress.”

Donnelly laughed and said, “the strength of the financial institution you’re dealing with,” is the best protection.

“I’d say your money’s pretty safe here in the state of Maine,” Donnelly added.

Michael Marino, senior loan officer at Camden National Bank, spoke about lending and credit.

“The banks are not looking at loan requests through a different set of glasses,” Marino said.

“We are seeing a trend in consumers wanting to pay down debt,” said Marino. People want to consolidate their auto loans and credit card loans with their mortgages.

Marino said for consolidation loans, homeowners need to have “substantially more worth” on their houses than what they owe.