Anatomy of a Bank Deal: Citizens Republic CEO on Why She Sold

The other options considered also had drawbacks or were unlikely to help Citizens maintain its growth in the next two years, Nash said. For example, if the bank had brought its credit card business back in-house, it would have had to hire extensively and by the time “we tried to do all that, spent all that, got your return, it’s probably a three- to five-year payback. My worry was, we didn’t have three to five years,” she said.

Drastically shrinking the bank “buys you some time, but I don’t think it solves the problem,” Nash said. Expanding inorganically proved tricky as well, since there is “fierce competition” for the worthwhile FDIC assets, and as a first-time buyer at that auction, Citizens would have faced a regulatory approval process that typically takes about a year.

Ultimately, “when we looked out over 2013 and 2014, we felt we could better do that with someone else than by ourselves. I still think that was the right decision for our company,” Nash said last week.

FirstMerit, which has assets of $14.6 billion, is still waiting on full regulatory approval for its deal and hopes to close the transaction by July 2013. Nash does not plan to stay on indefinitely, although she has offered FirstMerit CEO Paul Greig her assistance with the transition.

The two banks’ “teams seem to really like each other — they’re doing well so far,” she said last week.  “As Paul and I got to know each other over the past few years, and we started spending more time talking about our businesses, it was pretty clear we just think about things the same way. That’s pretty positive, it makes the transition easier for folks.”

Nash, who was on her way to speak Thursday at SourceMedia’s annual Small Business Banking conference, referred in passing to a couple of efforts to recruit her. But when asked for specifics, or whether she would prefer to work for a large or small bank next, she said she has yet to really start thinking about the next stage of her career.

 “I’m just out talking to people and seeing what’s going on, but I think there’s a place for both large and small,” she said. “Which one’s right for me, I don’t know.”