Its no Houston, but Spartanburg, S.C., has suddenly emerged as a hot spot for bank deals.
In the past three weeks, two out-of-state banking companies have announced plans to expand in the fast-growing city of 51,000, and two in-state banks have said they would open branches there. The most recent deal was struck last Wednesday, when Synovus Financial Corp. of Columbus, Ga., said it would buy $206 million-asset Carolina Southern Bank for $61.4 million.
Synovus, with $13.7 billion of assets, plans to merge Carolina Southern with its Columbia, S.C., subsidiary, National Bank of South Carolina. Though National Bank of South Carolina already has two branches in Spartanburg, Synovus president and chief executive officer James H. Blanchard said the company was eager to beef up its presence there.
Carolina Southern will substantially strengthen the presence of [National Bank of South Carolina] in Spartanburg, one of the fastest-growing communities in South Carolina and the Southeast, Mr. Blanchard said.
Much of the economic growth can be traced to BMW Manufacturing Corp.s decision in the early 1990s to build its U.S. plant in Spartanburg County. The company has 2,800 employees in the region and last year announced that it would add 1,000 more jobs with a $600 million plant expansion.
Moreover, the presence of BMW has helped lure other businesses to the region. About 100 firms from 19 countries have offices or factories in metropolitan Spartanburg, and the region boasts the highest per-capita international investment of any area in the country, according to Julie Maria Creek, director of marketing for the Spartanburg Chamber of Commerce.
With 100 international companies, it would be prudent for anyone to conduct business here because they can reach the whole world, Ms. Creek said.
Another plus is that Spartanburg is right smack-dab in between Charlotte and Atlanta, and the road from Greenville [S.C.] to Charlotte is just filled with businesses, said Christopher Kelley, an analyst for the Memphis investment firm Morgan, Keegan & Co.
Besides Synovus, BB&T Corp. of Winston-Salem, N.C., is also expanding in Spartanburg. The $50 billion-asset company, which already has eight branches in Spartanburg and surrounding communities, announced on Sept. 5 that it plans to buy $570 million-asset FirstSpartan Corp. for $104 million. (On Wednesday, BB&T also announced plans to buy a brokerage firm in nearby Greenville. See story.)
And two other banks are still looking to get into the area by building new branches or buying branches from other banks.
Three weeks ago, $208 million-asset Summit National Bank in nearby Greenville opened its first Spartanburg branch. A week later, $3 billion-asset First Citizens Bancorp in Columbia, S.C., announced that it would buy First Unions only Spartanburg branch.
All the dealmaking will leave Spartanburg with just two hometown banks $13 million-asset First National Bank of Spartanburg and $85 million-asset First South Bank. That, observers speculate, could trigger some de novo activity, though state and federal regulators report that no applications have been filed.
It is only natural for banks looking to expand in South Carolina to consider Spartanburg, said Arnold Danielson, a consultant with Danielson Associates Inc. in Rockville, Md. The citys population has grown by 17% in the past 10 years compared with an average of 10% throughout the state and the number of jobs created has ranged between 1,500 and 3,000 in each of the past five years.
Besides Charleston, its the other major financial business location in the state, Mr. Danielson said. Anyone who has a position in the state should want to be in the area.
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