Judy Turner is showing former executives of failed banks how to get back into the game.
Her previous bank, the $192 million-asset Decatur First Bank in Georgia, failed in October 2011. About a year later, she joined Atlanta's Private Bancshares as president of its Decatur market.
For now, Turner runs one branch, though she has collected nearly $16 million in deposits and landed business from former clients, including one of the Atlanta area's hottest restaurant groups.
Her return to banking, even in a smaller role than before, provides some hopes to bankers who remain in professional purgatory.
Many CEOs tied to failed banks have struggled to regain their footing, says Carrie York, president of executive search firm York & Associates. That's especially true in Georgia, which led the nation in terms of bank failures. "There's a stigma having worked for a failed bank," she says. Many executives who worked for banks that failed have had to take steep pay cuts to stay in banking, York says.
"We've been advising that it's a new normal and they need to take a 40% reduction in salary and get out there again," she says. "Put the ego away and do something that's going to add value to the community and things will work out for you."
Charlie Crawford, chairman, president and CEO of the $206 million-asset Private Bancshares, had no reservations about hiring Turner, even with her baggage as the former leader of a failed bank. Decatur First, like most of Georgia's failed banks, was "weighted heavily in real estate at a time when the real estate and financial markets took an unprecedented downturn," he says.
"We of course considered the circumstances of Decatur First," Crawford says. Private Bancshares also considered "many other positive factors, like Judy's 40-plus year track record in banking."
Turner knew she wanted to remain in banking, even when Decatur First was closed. "It is hard to imagine doing anything else," she says. "I've often said that it does not feel like work to me."
Turner and Crawford worked together in the mid-1990s at BankSouth, which sold itself to a Bank of America predecessor. Just after Decatur First failed, they discussed opening a bank in Decatur. She became president of Private Bank of Decatur, which is being branded as a separate institution even though it lacks its own legal charter. The sign on its building says "Private Bank of Decatur a Division of Private Bank of Buckhead."
"It seemed to be a good fit for me personally," says Turner, who declines to say if she was offered a job at the $2.6 billion-asset Fidelity Southern (LION) in Atlanta, which bought most of Decatur First's assets under a loss-share agreement with the Federal Deposit Insurance Corp.
Private Bancshares' Decatur is located in a prime spot a busy corner in the pedestrian friendly community located about six miles east of downtown Atlanta. In recent years, Decatur has become an essential player in Atlanta's bustling food scene because of a cluster of restaurants and bars situated around the town's courthouse square.
One of Turner's clients, Michael Gallagher, developed two of Decatur's most-popular establishments, Brick Store Pub and Leon's Full Service. Brick Store, modeled after a European pub, was named by Esquire magazine as one of the best bars in America and "the undisputed beer Mecca of metro Atlanta." Leon's, housed in a converted gas station, has helped lead a surge of interest in cocktail culture in Atlanta
Last year, Decatur governmental officials approached Gallagher about another historic preservation project renovating a city-owned train depot. The depot had housed other restaurants and bars, but several factors led to their failures, including the 19th century building's poor condition. The city and Gallagher knew the depot would require significant renovations to make any project work.
"We figured if [Gallagher's group] couldn't make it work, then we needed to find a different use," says Lyn Menne, Decatur's assistant city manager.
Because of past business dealings with Gallagher, Turner says she was the only banker contacted about the depot project. Though Turner says "it's hard to lend to restaurants" because of a high failure rate, she didn't hesitate to provide financing to Gallagher for the renovation. (She declined to provide the amount or terms of the loan.) The restaurant, Kimball House, which opened in September, was named for a lost Atlanta hotel from the early 1900s. It's received rave reviews from local food critics.
Whether Private Bank of Decatur is a success, Turner can count herself among the lucky bankers. Many former bankers at failed institutions have been unable to secure leadership positions. "A lot have gone into niche banking jobs, like [U.S. Small Business Administration] or asset-based lending," York says.
Others work, for a brief period, at the banks that bought the assets of the failed institutions. When Georgia Commerce Bancshares bought two failed banks tin September 2011, it kept the failed banks' CEOs through a transition period, says Mark Tipton, the $904 million-asset company's chairman and CEO.
John Bramblett, former CEO of Patriot Bank, worked at Georgia Commerce for a year after the Woodstock, Ga., bank failed. In September, he became a senior vice president and commercial relationship manager at the $289 million-asset Southcrest Bank in Johns Creek, Ga., according to his LinkedIn page. He declined to comment.
Larry Peterson, former CEO of CreekSide Bank, stayed at Georgia Commerce for about three months after the Cumming, Ga., bank's failure. Peterson is a managing director at FNB Bank, a unit of the $351 million-asset FNS Bancshares in Scottsboro, Ala., according to his LinkedIn page. Peterson could not be reached for comment.
Whether other former CEOs of failed banks can remain in the industry, "really depends on the circumstances surrounding the failure," Tipton says. "In some cases, it would be difficult," he says. "In other cases, the CEO did all he could do, but he got caught up with the real estate downturn and circumstances that were beyond their control."
Turner has plans far beyond restaurant lending, including loans for home renovations, new mortgage originations and commercial lending. She also offers treasury management and lockbox services. More than anything, Turner says she's just glad to still be a banker.
"Being in the community banking world allows me to help friends and acquaintances throughout the community," Turner says.
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Corrected January 6, 2014 at 2:37PM: An earlier version of this story misidentified the former employers of two bankers. John Bramblett worked at Patriot Bank and Larry Peterson at CreekSide Bank.