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Commercial lenders Ryan White, Bob Johnson and Bryant LeCroy joined CapitalMark in Tennessee because the smaller bank promised them more control of their loan book and better incentives, they say.
March 22 -
Trustmark (TRMK) has received approval from regulators to buy BancTrust Financial Group in Mobile, Ala. The Jackson, Miss., company had waited months for approval to by BancTrust Financial Group (BTFG).
January 25 -
Gerald Host, Trustmark's CEO, expressed confidence in his company's purchase of BancTrust despite some analysts' concerns about the seller's weak deposit positions in key Alabama markets.
May 29 -
Roughly two months after putting itself up for sale after its plan for raising fresh capital fell through, BancTrust Financial Group in Mobile, Ala., has found a buyer.
May 29 -
BancTrust Financial Group Inc. (BTFG) in Mobile, Ala., has put itself up for sale after its bid to raise capital from two private-equity groups fell through.
March 22
Acquisitions are one way to expand in an underrepresented market. Sometimes it makes sense to sit back and steal talent after someone else buys the bank.
ServisFirst Bancshares opted for the latter approach. The $2.9 billion-asset company just hired a lending team from BancTrust Financial, including the former chief executive, to ramp up in Mobile, Ala.
BancTrust, a former $2 billion-asset company, was
Trustmark spent more than $100 million on BancTrust, including
Recruiting
"That's just not always available," Carpenter adds. "So many markets have been picked over, and there are not that many banks to acquire."
Instead of seeking acquisitions, many banks have determined that it is more cost-conscious to recruit teams, says Scott Petty, an executive recruiter at Chartwell Partners in Dallas. "It doesn't require regulatory approval and you're not diluting" shareholders, he says.
Trustmark tried to keep Lamar, but "it didn't feel like the perfect fit," he says. "Before I propped my feet up, ServisFirst and I got together."
ServisFirst has about a dozen people working out of its Mobile office. It will probably open one or two more branches in the area, rather than buy another bank, though the business plan "is not heavy in bricks and mortar," Lamar says.
ServisFirst's strategy of limiting the number of retail branches per market is logical, says L.T. "Tom" Hall, CEO of Resurgent Performance in Alpharetta, Ga. "Having one major branch in a market? That makes a lot of sense," says Hall, who has served as a consultant to Regions Financial (RF) and other Alabama banks. Taking an efficient approach can make "your numbers hum."
ServisFirst is the second-biggest bank based in Alabama, after Regions. Mobile is the state's third-biggest market. To gain more prominence in Mobile, ServisFirst has taken space in BancTrust's former headquarters building downtown.
"It's déjà vu," says Lamar, who became BancTrust's CEO in 1989. "We had been in that office space for 15 to 20 years."
The $120 billion-asset Regions dominates Mobile, holding 38% of the market's deposits as of June 30, according to the Federal Deposit Insurance Corp. Lamar says ServisFirst is well-positioned to compete against the regional bank as it plans to offer commercial loans, cash management and treasury services.
Regions is "our biggest competitor, but we've assembled a commercial lending group second-to-none in Mobile," Lamar says.
About 44% of ServisFirst's $2.4 billion loan book involves commercial, financial and agricultural loans. At March 31, nonperforming assets made up about 1.3% of total assets.
Mobile is attractive for lending because of a diversified economy that includes manufacturing, shipbuilding, ports and higher education, Lamar says. The local economy should get a boost from Airbus, the European airplane manufacturer, which is planning a $600 million assembly plant in the area.
Analysts
During a conference call last month to discuss quarterly results, Peyton Green, an analyst at Sterne Agee, cast doubts that all of BancTrust's clients were "going to fit" Trustmark's credit profile.
Trustmark's executives defended the deal, stating during the conference call that they will be able to work through BancTrust's problem assets this year.
Trustmark will have a chance to "sort through things" in BancTrust's portfolio, Gerard Host, Trustmark's president and chief executive, said during the April 24 call. "New growth opportunities" will offset any loan issues.
Host, through a company spokeswoman, and Green declined to comment.