Kessel Stelling tells the Synovus story. Take 2.
The chairman and chief executive of the Columbus, Ga., company (SNV) last week took another stab at reassuring investors that he has a realistic growth plan for the coming months.
Concerns were raised in April when Stelling talked about Synovus' M&A prospects, and historic prowess in deals, during his conference call on first-quarter earnings. Some analysts have questioned the $25.9 billion-asset company's prospects for long-term profitability, and how it could afford to make acquisitions. Synovus has long been rumored as a potential takeover target.
Speaking at the Sanford C. Bernstein Strategic Decisions Conference on Thursday, Stelling said his comments had been misunderstood. He says he talked about M&A during the April call because analysts asked him about it, not because it's central to his strategy. And he singled out American Banker's story about the call, which focused on the M&A-related remarks and analysts' puzzled reaction to them, as misleading.
The first-quarter earnings call "perked ears up so much that I actually went back to review the transcript myself to see if I had been on the same call that I had read about in the American Banker," Stelling said in answering a question about investors' bad memories of past deals that had left it overconcentrated in certain assets. "And it was actually two different calls, so I'm still wanting to hear theirs."
Synovus does not "have an acquisition strategy," and its recent acquisition of the failed Sunrise Bank last month was "a transaction there that simply assisted the system with the orderly resolution of a bank" and was "not a financial play for us."
Stelling spoke optimistically about Synovus' performance, saying it was likely to report loan growth in the second quarter. He touted its new business lines, including senior housing, corporate banking, syndications and asset-based lending. He also noted that many of its markets, including Columbia and Charleston in South Carolina and Atlanta, are showing signs of improvement.
"The more rural markets for us are still somewhat challenged, but our major markets are doing well and our bankers are really back to playing offense," he said.