Displeased with its current banking relationships, the Absentee Shawnee tribe in Tecumseh, Okla., is not just switching banks — it is buying one.
Last week the tribe’s newly created holding company, AllNations Bancorp, received regulatory approval to acquire the $20 million-asset First National Bank of Calumet. And one of the tribe’s first orders of business when the deal closes next month will be to break ground on a branch near its reservation, so that more members will have access to banking services.
“Currently we go through local banks, and we don’t feel that they extend to us the same banking services we know that they have extended to others,” said Russell Ellis, the treasurer of the tribe, which owns the Thunderbird Wild, Wild West Casino in Norman.
The tribe’s administration has been using the $2.8 billion-asset Bancfirst of Oklahoma City and the $5.1 billion-asset Arvest Bank of Fayetteville, Ark., for its banking services.
But the two banks have no branches near the reservation, so the tribe’s members have been forced to use payday lenders, which are “on every corner” and charge “enormous interest rates,” Mr. Ellis said. “Now we will try and have our people come to us and pay much less money for the same amount” of financing.
Since First National’s only branch is 82 miles away from the Absentee Shawnee reservation, the tribe plans to open a nearby branch within six months. Once the new branch opens, the bank’s name would change to AllNations Bank, according to Mr. Ellis.
In the meantime First National Bank, primarily an agricultural lender, would start marketing more to the tribe’s members, as well as to other Native Americans. First National’s employees and executives would remain in place, but the bank would add several Absentee Shawnee members to its board while retaining some of its current directors.
Richard Thompson, who would stay on as First National’s president, said he and his family, who own the bank, were looking to sell it and the Absentee Shawnee offered the right price — $4 million.
First National’s customers are mostly ranchers and farmers, but it is looking forward to adding new ones, he said. “We serve a few Native Americans in the area and will welcome a lot more Native Americans as customers.”
Mr. Ellis said that the tribe had been looking for about three years to buy a small Oklahoma bank and finally worked out an agreement, which was a bit pricier than expected, with First National last summer.
Though the process of finding an appropriate seller took a while, it was much easier than starting a bank from scratch, he said. “When you start a bank you have to go through so many hoops, and we went through enough just buying one.”
Because of revenues from gambling, the Absentee Shawnee tribe is in better financial condition than many others in the United States. In fact, it recently expanded the casino, which it has owned for more than two decades, and is spending another $50 million to build a truck stop/gambling center on Interstate 40, near Shawnee.
The acquisition by AllNations would increase the number of Native American-owned banks to 19, including 11 in Oklahoma. The $33 million-asset Native American Bank in Browning, Mont., has been aiming to become a bank that serves all Native Americans across the country, but it has yet to open a branch outside of Browning. It lost $1.1 million in the first half of this year and $2.6 million last year.
Though AllNations hopes to serve more than just the Absentee Shawnee members, it has no plans to expand beyond central Oklahoma.
