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Still, a few bank executives wonder if they overshot projections. Some predict a market correction, though none seem eager to wave a white flag.
In this increasingly competitive market, banks large and small are attempting to hold their own by offering incentives for customers, catering to niche markets or individual clients, rolling out innovative service techniques or relocating top management to Charleston.
SunTrust, for instance, is in the midst of its My Cause campaign, in which the bank makes a $100 donation to a charity of a customer’s choice when he or she opens a business or personal savings account.
In August, Peter Bristow, the president and CEO of First Citizens Bank and Trust Co., moved from the company’s Columbia headquarters to Charleston, where he is focusing on boosting business along the coastline by highlighting the fact customers can have quick access to a bank executive, a unique opportunity for out-of-town mid-sized banks.
Shortly thereafter, the bank just introduced its Visa payWave card, which allows customers to simply wave the card in front of a secured reader, as opposed to swiping it.
When national banks emerged in the 1980s, buying defunct or struggling institutions across the country, the “middle” – banks larger than two or three branch community institutions but without a large national presence – was looked down on, but today, Bristow said, it is “a pretty interesting place.”
The trend toward the small and middle isn’t unique to Charleston or South Carolina, said Robert Hill, CEO of South Carolina Bank and Trust, a Columbia-based institution that also ranks itself in the “middle.” Particularly in rapidly growing coastal communities that have been traditionally controlled by large out-of-state banks, small- and medium-sized institutions are making a comeback, he said.
“A bank is really people,” Hill said. “The quality of customers and the quality of employees is the most important part of it. People bank with employees.”
Small startup banks also are convinced they can survive the local competition even as the national economy struggles. In February, three longtime friends, all 1992 graduates of The Citadel, pitched in $500,000 worth of stock and opened Atlantic Bank and Trust Co., which has only one full-service branch office, located in downtown Charleston.
President and CEO Hal Cobb said he’s attempting to set his bank apart by aggressively pushing high-tech convenience features. His bank, for instance, will give businesses a free Check Connect machine, which scans company checks, thereby negating a need to visit a branch.
“The banking industry is really evolving right now and I didn’t see anybody doing anything new or innovative in this market,” said Cobb, who is partners with his Citadel classmates, Chris Landers, chief mortgage officer, and Dean Lang, chief lending officer.
Despite their optimism, Hugh Lane Jr., president and CEO of Bank of South Carolina, doubts all the new banks will survive. His institution celebrated 20 years of business in February, which offers an amenity that’s hard to beat and impossible for a newcomer to replicate: historical roots.
“From where I sit, I just don’t see enough good loans to support the good earning assets a bank requires,” he said. “I don’t think they’ll go out of business, but I do think there will be consolidations.”
If his prediction proves true, it would mark a new trend in the Charleston region’s banking industry. In the past seven years, the only bank acquisition was of Ropers Employees Federal Credit Union by Carolina Federal Savings Bank, according to Samuel Caldwell, an Atlanta-based industry analyst with Keefe, Bruyette and Woods, an investment banking firm.
In the entire state, there have only been 10 bank acquisitions or mergers since 2004, none of them in the tri-county region, compared with 13 in North Carolina and 42 in Georgia, said Andy Borrman, an industry analyst with Atlanta-based Morgan Keegan.
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