NEW ORLEANS, Nov. 21 - At one bank branch, vandals whacked futilely at a vault with what must have been a crowbar. At another, looters worked over an outdoor cash machine, stripping its plastic molding and exposing the metal and wire innards but never reaching the stack of bills locked inside. After smashing through a glass door, the intruders took a sledgehammer to the cinderblock wall housing the bank vault. They bashed a hole large enough to crawl through-if not for the thick steel plate on the other side.

These are some of the depressing scenes that met Alden J. McDonald Jr., the chief executive of Liberty Bank and Trust, the largest black-owned bank in New Orleans, as he toured the eastern half of the city in early November. This vast stretch-encompassing the 9th Ward, the 7th Ward and New Orleans East-is home to most of Liberty's customers as well as the bank's headquarters prior to Hurricane Katrina.

The visit was in part a field trip to inspect the moldy, stinking remains of bank branches hit hardest by flooding and looting. But mainly Mr. McDonald was on a scouting expedition. Here, in the predominantly black, eastern half of New Orleans, he was searching for signs of activity that might justify the reopening of some of Liberty's six closed New Orleans branches. The bank is operating only two of its eight New Orleans branches, both located in the western half of the city.

Mr. McDonald found little cause for optimism.

Nearly three months after the storm, reconstruction of the New Orleans economy is turning out to be slower and more complex than many people first thought. Basic services like electricity, water and sewer are still lacking in large swaths of the city, including the New Orleans East neighborhood, home to four of Liberty's eight New Orleans branches.

The New Orleans school district optimistically said it would open a small number of its schools by the start of November, but that deadline has passed without any action. Residents from low-lying areas await word on the city's plans for their neighborhoods. Meanwhile, toxic mold clings to everything it touches and permeates the air, sickening even occasional visitors.

Looted buildings have yet to be cleaned up and wrecked structures yet to be leveled because there are not enough workers to haul away the debris. And some businesses, including Liberty, are trapped in limbo as they try to negotiate settlements with insurance companies.

"Depending on the settlement, I'll clean up or I'll tear it down," Mr. McDonald said.

Liberty's slow progress returning to New Orleans, despite Mr. McDonald's best efforts, is the wider tale of the Crescent City. And just as Liberty is dependent on the local economy's rebirth, the city needs Liberty to write commercial loans and home mortgages to start the painstaking rebuilding progress. Mr. McDonald, who is chairman of the New Orleans Chamber of Commerce and serves on the commission the mayor appointed to devise a rebuilding plan for the city, is never quite sure if he is helping his bank or his city, in large part because they are often one and the same.

"Anything we do to get people back in town helps my bank," he said. "Anything we can do to help New Orleans get back on its feet helps me." As Mr. McDonald drove the streets of the 7th Ward, a working-class community of bungalows where he grew up, he found only scant traces of life. There were almost no people on the streets for blocks on end, and virtually no cars traversed thoroughfares that would normally be crowded at midday. So instead he pointed at skeletons - businesses Liberty had helped to underwrite and that, since Katrina, have been boarded up, and homes the bank financed that are now sitting unoccupied.

"This here was my customer base, and it's just gone," he said. He shook his head, and his normally sleepy eyes bulged in disbelief. It is a phrase and look he would repeat a half-dozen times during a three-hour excursion, as if still trying to bend his brain around the immensity of it all.

More than half the journey was spent crisscrossing the streets of New Orleans East in the city's northeast quadrant. If anything, this corner of New Orleans, where the city's black middle class and professional class was concentrated, offers a picture even more disheartening than the low-income 7th Ward. In select pockets of the city, such as Uptown and the West Bank, where two Liberty branches have reopened, lights blaze in windows at night and restaurants and bars along major thoroughfares are sometimes so packed that one must hunt for a nearby parking space.

Yet if life in communities such as Uptown once again spool by in Technicolor, life in New Orleans East still plays out in black and white.

There's something ghostly about the area that, pre-Katrina, was home to about 90,000 people. Trees still lean on collapsed rooftops. Yellow insulation bleeds out of homes; gutters sit at odd angles, like fractured limbs. Everywhere, cars sit at whatever angle the floodwaters left them.

Virtually all of New Orleans East is still without electricity. Homes and businesses still have no drinkable water or working toilets -and will not for a minimum of six months, according to the city's Sewerage and Water Board. The only people in evidence are crews of men in hard hats, dressed in jeans and hooded sweatshirts and wearing bandanas across their faces, bandit-style.

"When people talk about the city repopulating, it's all in Uptown New Orleans, it's on the West Bank, it's in the Quarter," Mr. McDonald said. "None of this is repopulated."

The bad news for Liberty is also good news: The bank will not have to spend the cash it does not have to fix boarded-up branches in the eastern half of the city, nor will it need to dispatch the personnel it does not have in a tight labor market to staff outposts in deserted parts of town.

Liberty's branches in the eastern half of the city lay in ruins. The floors are still strewn with broken glass. Desks and chairs and dead plants, all of them coated with a thin film of muck, lie toppled over.

The bank's operations center, a bunker-style building in New Orleans East that had formerly housed Liberty's main computer and paper files, is another disaster. The building took water almost to the roof, and now it is "unsalvageable," Mr. McDonald said.

In far better shape is the bank's main headquarters, a six-story glass box located a few blocks from the operations center. That building, which Liberty had occupied for less than six months prior to Katrina, suffered both wind damage and flooding, but little damage above the first floor.

"We were all set to move our computer center on to the third floor but" - Mr. McDonald never finished the thought. Instead he shook his head and chuckled. Last month the bank spent $500,000 on a new mainframe computer. He sees loss everywhere in the eastern part of the city, so what's another half-million dollars?

To stop the mold from spreading inside the bank's main offices, Liberty is spending $1,500 a week on fuel to operate an emergency generator that blows dry air into the building.

Mr. McDonald has not taken similar steps to save his own home in Lake Forest Estates, a pricey section of New Orleans East. His was a handsome brick house complete with a swimming pool, an exercise room and two-car garage - before it was flooded by at least four feet of water. Instead of trying to gut the home, as a small percentage of his neighbors are doing, he has given it up as "destroyed."

It is no wonder. A dark, evil-looking mold has taken over the walls, and the home still smells as if bathed in fetid swamp water.

"We'll retrieve whatever we can and start over," said Mr. McDonald, 62, who is married with three grown children.

Mr. McDonald had one additional stop to make after leaving New Orleans East. Liberty runs a small branch inside a supermarket in the Gentilly neighborhood. He had heard that the grocery store was planning on reopening by mid-November. That branch suffered little damage, so he figured on assigning a team of four people to run it - the same number that had worked there prior to Katrina.

But that was before stopping by the store and driving around the neighborhood, a middle-class enclave just south of Lake Pontchartrain. He saw an occasional car in a driveway. He spotted a gardener working on someone's front lawn.

But mainly he saw a community still in stasis. Large sections were flooded, and parts were still without electricity.

"Who's going to bank here?" he asked. "There are small signs of life, but it's spotty. It's spotty at best." By trip's end, he decided he would dispatch one person to that branch - if he dispatched anyone at all.
 

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