George Schaefer is leaning over his conference table, pointing to the nicks and scratches on this particular piece of furniture in his corner office.

"It's the same office that two CEOs before me, William Rowe and Clem Buenger, occupied," the ebullient banker says.

"Look at this fine piece," he says, knocking hard on the table.

Yes, the furnishings in Schaefer's corporate office are best described as old. Not antique. Old. Shopworn. That's obviously a point of pride with the cost-conscious president and CEO of Fifth Third Bancorp, the nation's 13th-largest bank.

Keep overhead down. That's the yin, the dual side of the twin mantras that George A. Schaefer Jr. repeats again and again to anyone wh'™ll listen. The yang is "sell the product."

"It's all about keeping down costs, running the bank efficiently. The other thing is sales, which is all a matter of execution."

Emphasizes Schaefer: "Our job is to make money for the shareholders."

Schaefer holds up a ticket for his upcoming Delta flight. He'll be flying coach. Always does when he's on business. No corporate jet, not even a first-class commercial flight for the chief executive officer. "The spouse doesn't like it," he acknowledges of his wife, Betty Ann.

"No chauffeur," Schaefer continues in his staccato delivery. Not even a company car. "When I go out on company business, I drive. I get 27-and-a-half cents mileage, like everyone else."

"Cheap" would probably be an unkind word to describe Schaefer. More like "practical." "Frugal." "Efficient." Instead of handing out expensive crystal trophies as sales awards, he hands out Johnston & Murphy shoes. True story.

At the moment, we're seated in Schaefer's private office. Actually, it's hardly private. No door, no wall, even "” it's wide open to the rest of the corporate suite. Schaefer's way of staying connected.

The morning's Wall Street Journal lies on a table, announcing the news that Bank of America is acquiring FleetBoston "” a pointed reminder of how unpredictable this banking business can be.

But Fifth Third is nothing if predictable. "We're in our 30th year of record earnings," Schaefer says.

Responding to the news of the day, the 58-year-old Schaefer suggests the banking business isn't as unstable as the headline might suggest. "What you don't know is the number of financial institutions out there. Just in the state of Ohio, there are 225 banking companies, 125 thrifts and S&Ls, and 570 credit unions. Just in the state of Ohio. Not branches, but companies.

"We have almost 950 competitors out there," Schaefer says. "Yet our basic product doesn't change. We can't have a 'new and improved' product. We can't have new [kinds of] dollar bills. All 950 offer the same product."

What Fifth Third can offer, its edge on the competition so to speak, is safety. Soundness. Reliability. Predictability. It's Moody's highest-rated bank "” Aa1 "” in Ohio. "That helps us stay competitive. We've been around 145 years."

Schaefer himself has "been around" for 32 of those 145 years, assuming the role of president and COO in 1989 and president and CEO in 1990.

Few in Cincinnati question the decisions that Schaefer makes inside The Fortress (the term some locals apply to the company's Fountain Square headquarters). Even fewer can argue with six stock splits "” 3 for 2 "” over the past decade. NASDAQ Magazine recently reported that a $10,000 investment in Fifth Third Bancorp shares in 1976 would have earned an investor $3.6 million by the end of 2001.

Yes, it's tough to find a critic of Fifth Third, although one wag of a business reporter has a photocopy of a dollar bill pinned up in his cubicle, George Washington's face replaced with an image of the other George. "Both Georges churn out money, one courtesy of a government printing press, the other like he's got his own printing press somewhere in the basement under Fountain Square."

THE ROCKY ROAD TO CEO

George Schaefer is no rocket scientist. He is, however, a nuclear engineer. Really. The tale of how a nuke demolitions expert wound up running one of the country's largest banks is a trip on a rocky road, much like the 25-mile highway Schaefer helped build just outside Saigon during the Vietnam War.

"My history is pretty straightforward. I was lucky growing up in Price Hill, going to Elder High School." At the west side's Elder, Cincinnati's football powerhouse, he played tight end. Classmate Jim Knippenberg, now a reporter and columnist at The Cincinnati Enquirer, remembers. "George stood out as somebody different, as somebody who was going to be different."

Schaefer earned his bachelor's in nuclear engineering at the U.S. Military Academy at West Point, graduating in 1967 and also training with the U.S. Army's elite Rangers unit near Savannah, Ga. The Army captain then served a two-year tour in Germany in a nuclear demolition munitions unit before shipping out to Vietnam in 1969 to build a 25-mile supply road near Saigon. He was awarded the Bronze Star for valor a year later.

"West Point, obviously, was a very special place," Schaefer says of the military experience. "And Vietnam, well, to be in a war zone, most people have no concept of what it's like. Like they have no concept of what it's like to be in Baghdad right now."

It was after his military career that the George Schaefer success story ended "” or so some might have believed at that time. "My education was as a nuclear engineer. I was going home to work at Zimmer nuclear plant. I had a job all lined up." Then came a license delay and hiring freeze as Cincinnati's Zimmer dealt with multiple problems (the power plant finally converted to coal fuel).

So it was 1971. Schaefer had no job, and no prospects. "I had sent out 80 resumes, and frankly didn't get a lot of offers. I finally started at the bank on July 20th, 1971, as a trainee." Yes, the chief executive of Fifth Third candidly admits the banking business hadn't been his first choice. In many ways, it was like starting his life, his career, over "” at $8,500 a year.

BOOT CAMP REDUX

Now it's 32 years later, 13 of them as CEO. And Capt. Schaefer runs the four divisions of Fifth Third "” retail banking, commerical banking, investment advising and electronic processing solutions "” much like a finely tuned Army campaign.

"Being an old military guy ..." is how Schaefer begins at least two sentences. The chief executive's background clearly affects his leadership style. "The military is a great training ground. The people skills ... getting people to talk to each other. I can remember the days of people from the South meeting people from New York City for the first time" in boot camp.

Schaefer, in fact, endorses universal military training for all citizens to this day: "It forces you to learn the people skills."

The military influences his competitive strategy, as well. He's fond of telling national business magazines, for instance, that banking in Cincinnati is akin to "guerrilla warfare."

BITING INTO A YORK

The corporate staff members are nibbling on York Peppermint Patties today "” at this very moment, Mayor Charlie Luken is standing in front of the Fifth Third corporate lobby on Fountain Square, declaring "Peppermint Pattie Day" in Cincinnati. (The city sells more of the mints than any other on the planet, thanks to York's iconic presence in Skyline Chili outlets.)

The corporate suite seems to scream "Cincinnati" in more ways than the Yorks "” the pictures, the desk memorabilia, the calendars, all identifying with Cincinnati and the corporation's firm Midwestern roots.

Schaefer is speaking to the Fifth Third mission: Understand and deliver a core product while maintaining an unrelenting focus on customer service. "Walk into one of our branches anywhere. Our tellers and managers ... [are] based on taking care of the customer, which results in profitability," he says.

Nearly 80 percent of Fifth Third employees own shares directly in the corporation. "Our employees own the company. If we're hiring you in the mailroom, we'll give you an additional 15 percent of shares" above cash salary. The company counts more than 400 millionaires in its ranks thanks to the stock buys.

"They own the bank instead of being mercenaries, instead of just working here," Schaefer proclaims, the first hint of pride coming into his voice. He doesn't have to mention, of course, that this keeps everyone in the rank and file attuned to the given day's stock price.

Schaefer maintains that if you stroll into a Fifth Third branch to cash a check, the teller isn't as likely to "snarl" "” his wording "” at you since they actually own a percentage of the business.

Nonetheless, the banker relentlessly keeps tabs on all his branches. "Each branch manager runs the branch as if it's their own personal business," says Stacie Haas, an assistant vice president at the bank. "George reads their performance statements every week" in a pile ranked from top to bottom. "He encourages people at the bottom of the list to talk to people at the top of the list."

The determination has come at a cost: Two heart bypass operations. "The arteries feel pretty good," is how Schaefer deflects reporters who ask about his health.

For his part, Schaefer describes his obsession with performance and customer service this way: "My wife was down in Naples, Florida. Some guy she overheard was making a comment he wasn't getting good service at his bank. Betty, she said, 'Excuse me, are you talking about Fifth Third?' " Betty got on the phone, and, suffice to say, the bank branch manager was enlightened on the customer service mantra. "An in-depth conversation," is how Schaefer puts it.

THE ROAD BUILDER

Schaefer fosters the attitude "” the "culture" "” of serving customers in every meeting he attends, every discussion he completes. Every employee is attuned to customer complaints, to either getting it right the first time or correcting any problems. "Not only employees, but their spouses, friends, families."

Schaefer motions to the assistant vice president, Haas, who is sitting at the shopworn table. "How many of your relatives work here? Four?"

"Yes," Haas responds, "four including my husband."

The corporation sees value in the employees owning stock. "If you're starting here at $20,000 a year, you can buy $5 of shares a week."

The family culture, the sense of place in the community, the empowerment and ownership, all these intangibles contribute to the fulfillment of the Fifth Third mission. "It's personal as well as business," notes Roberta R. Jennings, the vice president of corporate communications.

Schaefer interjects. "We screw up. We make mistakes. Five million checks float through this place each day. It's how you handle the mistakes that makes the difference."

"Elaine out there," he says, pointing to his executive assistant, Elaine Stone. "If somebody calls her having a problem or wanting to open an account, she doesn't do what corporate usually does and give a runaround. In 15 seconds, somebody is calling that person back and opening the account."

As motivator-in-chief, Schaefer "” the veteran road builder "” could be called a corporate road builder. He stresses the value of keeping channels open, of communicating at all levels: "We look at it a little differently. We run 17 different bank [systems], each one a community bank. Whether it's in Cincinnati or Dayton or Cleveland or Chicago."

For all his accessibility, Schaefer strictly separates his business life from his family life. He'll only say he and his wife live on the east side with their three children and five grandchildren all close by. The grandchildren are his passion, though golf comes in a close second.

EYE ON THE BALL

Back at Schaefer's Spartan office, the road builder is in his element. His office is smaller than the average family dining room. The view stares directly into the building facade across the street. No penthouse suite. No high-rise scenic view of the skyline. Practical. Fundamental.

"We've stayed very focused on the banking business for a long time," Schaefer notes, addressing the theme of practicality. "It's our culture to stay focused on the fundamentals of banking. Whether we're in Dayton or Cincinnati or any other of our 17 markets, we take care of our customers."

The chief executive leans over and touches the reporter's sleeve, as if passing along a guarded secret: "We stick to our knitting."

Yet for all its focus on remaining conventional, the bank has often veered into the unconventional. Fifth Third runs one of the world's largest foundations focusing on support for women and girls. It innovated one of the first shared ATM networks in the 1970s. It pioneered the concept of seven-day-a-week bank branches in grocery stores. And the company continues to operate the only bank open 365 days a year in Greater Cincinnati, the Fifth Third branch at Cincinnati / Northern Kentucky International Airport.

Of the 135 Fifth Third outlets in Cincinnati and Northern Kentucky, in fact, 30 are branches located in Kroger stores. "The Sunday afternoon loan is definitely a convenience factor," Haas observes.

For his part, Schaefer says: "Banking is a pretty simple business. Give us your money to keep safe, or we give you our money in the form of a loan. It's kind of like eating lunch. Everyone's been eating lunch for thousands of years. Sure, we have competitors. But basically, the underlying business is pretty much the same as when commerce traded on the Ohio River."

That said, ATM banking has added a new twist. The bank will process some 10 billion electronic transactions this year. "That's changed a little bit, the payments mechanism." And the reasons people take loans have evolved as well. "One hundred years ago, it was mules. Now it's Honda Odysseys."

"The Midwest is an excellent place to do business," the banker explains. "The culture, the work ethic, all as good as anyplace in the world. And plenty of opportunities."

Schaefer pans the corporate suite with his arm, then gestures out his window. "Cincinnati itself has a very good quality of life. It's a great place to raise kids in a minivan and play soccer." The CEO points to all the indicators "” the arts, the schools, hospitals, the University of Cincinnati, the airport "” as integral parts of the Fifth Third success story, the ability of the company to attract and keep talent long term. The international airport, for instance, keeps the bankers connected to the world. "I can go to Paris tonight. Twice, two different, direct flights. We can have the whole world here."

THE ULTIMATE VOLUNTEER

Interestingly, while Schaefer sits on only one corporate board of directors other than Fifth Third (Anthem Inc.), he volunteers on dozens of community and civic boards including the Cincinnati Children's Hospital Medical Center (where he's been known to witness operations and generally stroll the corridors conversing with doctors and nurses), the United Way, the Cincinnati Institute of Fine Arts, the Johnny Bench Scholarship Fund, the Dan Beard Council of the Boy Scouts of America, the Taft Museum of Art, Chamber of Commerce, the Cincinnati/Northern Kentucky International Airport and the Health Alliance of Greater Cincinnati. His charitable contributions via the George A. Schaefer Jr. and Betty Ann Schaefer Foundation totaled $1,997,182 in market value last year.

As chairman of the University of Cincinnati board of trustees, Schaefer helps steer the city's largest employer and was a key participant in the search for a new campus president this year. And as a member of the elite Cincinnati Business Committee, he sits with two dozen CEOs from The Procter & Gamble Co. and elsewhere.

Cincinnati City Manager Valerie Lemmie recently tapped Schaefer to lead the Economic Development Task Force. "He took hold of the issue and spent a lot of volunteer time," Lemmie says. "I have nothing but praises to sing. It's very difficult for a CEO to devote hours of time to this."

The task force's conclusions have the banker's fingerprints all over: Creating one-stop business centers that cater to the city's "customers," emphasizing superior communication, measuring and achieving results.

"City government is now focusing on serving customers instead of citizens," the city manager says. "To make ourselves responsive whether you're Harry Homeowner or a large developer."

Lemmie relates a more personal anecdote: "George was the first businessperson to take me to lunch when I arrived in town. He was the first to include me in business programs that really opened the door for me. I will always appreciate that."

KEEPING SCORE

Something else can be said about George Schaefer. The former Elder High School tight end likes to keep score. He ticks off the achievements: More than $80 billion in assets. Some 50 acquisitions under his leadership, including Chase Bank in Cleveland, Farmers Exchange, Sovereign Savings, First National of Dayton, PNC Bank's Dayton division, Mutual Federal Savings Bank in Dayton, and The Ohio Company in Columbus. And financial growth under his leadership from a base of $7 billion to more than ten times that amount.

More than enough to make any board of directors happy "” Fifth Third's has included such notable local names as Neil Armstrong, J. Kenneth Blackwell, John F. Barrett, Richard T. Farmer, Dudley S. Taft and John J. Schiff Jr.

Schaefer believes Fifth Third stands on a strong foundation.

"Seriously, if you look at our footprint," Schaefer says, you can see the company's direction without benefit of a crystal ball. "We're into Tennessee and West Virginia. We only have 7 percent of the business in those states. We'd like to have 15 percent of the business in those states. Before going to California."