- Key insight: Under new ownership, Parkway's leaders plan both to grow organically and to consider M&A opportunities.
- Forward look: The bank expects to add about 20 bankers over the next month.
- Expert quote: "I think you'll see more C&I lending, more of what I'll call traditional business lending, more core-deposit franchise build than what former Parkway was able to accomplish." —Chip Reeves, Parkway's incoming CEO
A pair of former bank CEOs, both of them self-described "bank junkies," have taken over a Chicago community bank with plans to kick-start its growth.
David Provost, the former CEO of Detroit-based Talmer Bancorp, and Chip Reeves, who led the $6.1 billion-asset MidwestOne Financial Group in Iowa City, Iowa, until its sale to Green Bay, Wisconsin-based Nicolet Bankshares in February, announced Thursday that they had assumed control of the $3.7 billion-asset Parkway Bank. Provost will serve as Parkway's executive chairman, Reeves its CEO.
"Neither of us need to do this, but we are more excited than we have ever been about this opportunity," Reeves told American Banker on Friday. "We are bank junkies. We love building teams. We love the customers. We love seeing how we get connected with the community."
Dennis Klaeser, who served as Talmer's chief financial officer, will be Parkway's executive vice chairman.
Parkway, which was controlled by Chicago's Suspenzi family for nearly four decades, changed hands following a $350 million private placement that was led by a pair of prominent bank investment firms: Patriot Financial Partners in Radnor, Pennsylvania, and Greenwich, Connecticut-based Stone Point Capital. Parkway used the cash to fund a tender offer to repurchase shares from the former owners and bolster the bank's capital.
Parkway was founded in 1964. Longtime CEO Rocco Suspenzi joined the bank as a loan collector in 1968. While he courted controversy with some nonbank business ventures, including involvement in an ill-fated casino project in the late 1990s and early 2000s, Parkway reported an unbroken string of annual profits dating back to 2011.
At the same time, Parkway has steered clear of asset-quality issues since overcoming a spike in problem loans following the 2008 financial crisis.
"It's a very clean platform, which gives us a lot of opportunity to grow without having to work on cleaning up some issues," Provost told American Banker. "We're very happy with the platform."
Out of the gate, Parkway's new management team will focus on adding bankers and growing its portfolio of commercial-and-industrial loans to complement its more robust commercial-real-estate lending operation, according to Reeves.
"I think you'll see more C&I lending, more of what I'll call traditional business lending, more core-deposit franchise build than what former Parkway was able to accomplish," Reeves said.
"We have about 20 bankers that are going to be joining us over the next 30 days, and we'll continue to build from there," he added.
Longer-term, Parkway could explore mergers and acquisitions as it pursues expansion.
"We'll look for opportunities to buy some banks or [establish] some offices around the Midwest," Provost said. "I'd love to have something in Michigan, where we have a lot of investors on the retail side, on the non-private-equity side. It's a good base for us to capitalize on."
Talmer, which Provost helped found in 2007, mushroomed, merging with Chemical Bank in Midland, Michigan, in 2016. It grew again following Chemical's merger-of-equals with Minneapolis-based TCF Financial in 2019.
Provost, who joined Chemical's board following the deal with Talmer, took over as CEO of TCF in October 2020. He was leading the $48 billion-asset TCF when it announced plans to merge with Columbus, Ohio-based Huntington Bancshares two months later.
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Following TCF's acquisition, Provost said he signed a five-year noncompete agreement, which expired in June. He began planning his return to active banking about a year ago. Not long after, an investor let him know the Suspenzi family might consider selling Parkway.
"I was brought in after that," Provost said. "It's really estate planning and succession planning on that side, but it's a great opportunity for us."
"I actually talked to Rocco in 2016," Provost added. "We had some conversations, but he wasn't ready to do anything at that time."
According to Provost, part of the preparation for taking control of Parkway involved hiring a CEO, so when MidwestOne was sold, leaving Reeves without a job, "the timing was perfect."
