On November 6, 1939, a group of Texans established a bank at the corner of Preston Road and Mockingbird Lane in the Highland Park Shopping Center. Highland Park State Bank had a capital base of $97,500 and 11 employees. Preston State Bank, as it was later re-named, remained a neighborhood fixture for more than 40 years, probably the largest independent bank in the state and one that held out the longest against the rapid financial institution mergers of the early 1980s.

During those many years, two men met, worked together and implemented new ideas in banking.

Ever heard of charge cards?

George Zarafonetis still thinks about those days and the road that led him to the late Weldon Howell, to Zarafonetis’ own long career in banking, and to a thin small piece of plastic that, for better and worse, fundamentally changed the way we live our lives and conduct business.

A will and a way / The man who helped create charge cards learned about creative financing early on.

One day, when Zarafonetis was a senior in high school, his mother told him that he was going to “go to college,” and not just any college.

“You’re going to SMU,” she said.

“But how could my family afford SMU?” he remembers thinking. Then his mother handed him an envelope filled with money – money he had earned during his paper-throwing years, from the age of 13 through high school…enough money to pay his SMU tuition for the first year.

At the end of that year, the money was gone.

“My father, in his usual immigrant way, requested a meeting with the dean of the college,” Zarafonetis says. “At that time, FDR had a financial assistance work program available to students, and the dean put me to work through that (program). I earned my tuition for the next three years.”

It has been nearly 60 years since he bought his class ring, but Zarafonetis still proudly wears it.

“I paid $33 for it. You couldn’t replace it these days,” he says.

As a 1941 graduate, Zarafonetis says he was one of the last recipients of a Bachelor of Science in Commerce degree from SMU; after that year, it became the Bachelor in Business Administration.

Banking on the future / Upon his return from World War II, Zarafonetis continued to pursue his career in customer credit lending, obtaining his early work experience with Sears and the Bureau of Labor and Statistics.

“When I was in school, there was no such thing as consumer credit. Consumer finance was a brand new field back in the ’30s and ’40s,” he says. Zarafonetis grew up in a close family, but he speaks with similar affection of the man who, in 1954, gave him his big break in banking.

“I was president of the Consumer Manager’s Association when I first met Weldon Howell,” he recalls.

Howell, a commanding presence and president of Highland Park State Bank, put Zarafonetis in charge of an innovative consumer finance program. In February 1953, the bank had introduced a new service designed to accommodate the credit and billing needs of neighborhood merchants – the Highland Park State Bank Charge Plan.

The emerging world of “cash and carry” was in its infancy, but Howell and Zarafonetis moved things along a little faster.

The impetus was there. Merchants valued the idea of “no-risk business.” They received their money up front, in full, and loyal area retail customers liked the idea of the bank’s “open loan policy,” Zarafonetis says.

By 1956, the plan – now known as “Presto Charge” – was made available to other banks on a franchise basis. Howell and Zarafonetis also began holding a National Credit Card School to assist bankers throughout the country as they began to implement similar programs. Zarafonetis, as vice president of consumer lending, was in the catbird seat of an entirely new financial world.

The need for more space prompted Highland Park State Bank to move from Mockingbird Lane and Preston Road (Ralph Lauren’s store today) to Preston Center in 1958. The bank continued to grow, and 10 years later, the conveniences of Presto Charge became national in scope with the advent of the Interbank Card Association.

But the idea behind Howell and Zarafonetis’ original plan didn’t entirely go away with the explosion in national and international credit options. Preston State Bank began offering a Master Charge and VISA program in the 1970s to qualifying customers seeking a credit card with worldwide acceptance.

But with their eyes continually focused on our neighborhood, the bank’s leadership kept Presto Charge as a local financing option with less stringent requirements for those struggling to establish credit.

By 1979, a few years before Preston State Bank disappeared forever into a holding company, the Presto Services cardholder program generated about $232 million in consumer volume.

Passing the torch / An enduring principal in business is that good ideas remain valuable at their core, and that such ideas usually become reality with a first simple step.

A man named Ralph Schneider decided to form Diner’s Club one night after he lost his wallet. Weldon Howell and George Zarafonetis wanted to make the lives of neighborhood merchants and customers a little easier.

You have to give them credit.

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