Local bank continues growth spurt
Many community banks took a beating during the Great Recession.
Some small institutions that were weighed down by bad loans on their books folded or were closed by federal regulators. High Point-based Bank of North Carolina not only survived the financial crisis, it has thrived of late.
BNC has acquired five banks in the last three years and, earlier this month, announced a sixth deal, this one a merger with Asheboro-based Randolph Bank & Trust Co.
The merger coincided with a transition in BNC’s leadership.
Founding President and CEO W. Swope Montgomery Jr. retired on June 11 and was succeeded by Richard D. Callicutt II, who took over as president and CEO 22 years after joining the bank when it was first established in Thomasville.
Callicutt said Randolph Bank & Trust Co., which has branches in that county as well as Alamance, focuses more on small business, commercial and industrial lending than BNC, which is one reason it was an attractive target.
“A bank like our’s that been built on a lot on real estate lending over the years, we need a little more diversity in the loan portfolio, so they give us that,” he said. “It also give us an opportunity to advance the ball toward the Triangle, with their presence in Alamance.”
Coming out of the recession, BNC leaders took advantage of opportunities to diversify and grow into new markets.
Their first acquisition was Beach First National Bank in Myrtle Beach, S.C., which was closed by federal regulators in 2010. Two other institutions on the FDIC list of failed banks — one in Asheville and the other in Charleston, S.C. — also were acquired.
Montgomery said BNC brought in high-level chief credit officers over the past few years to help out during the financial crisis.
“There’s no doubt we had credit issues like others did, just not to the extent they did,” he said. “We had sufficient capital to get through the crunch, and we had great relationships with the regulators. We’ve been disciplined with growth opportunities. We’ve looked at a lot of deals and gone forward on a few.”
Last year, the bank raised $72.5 million in capital that included some private equity but also institutional investors. The growth continued, with acquisitions in Greenville, S.C., Durham and Charlotte. The bank now has 32 branches in both Carolinas and $3.2 billion in assets.
“The footprint is really built around not being beholden to one economic market,” Callicutt said.
BNC plans to concentrate more on mortgage lending as the housing market recovers. The company is adding mortgage originators in the Triad, Callicutt said.
“We have now what’s a very robust mortgage division,” Callicutt said. “We’ll do close to half a billion dollars in closings this year. The nice thing about that is, we’ve been able to build it around the improvement in the market and on the purchase side, so it’s not built around the ebbs and flows of the refinance market.”
Montgomery, who remains involved with the bank as vice chairman of its board of directors and as a consultant, said future growth will depend in part on when a given bank is ready to sell.
“I would say we’re going to continue to look at opportunities, but, I think early this year, we and the board said, ‘Let’s pull all these acquisitions together and really focus on profitability and getting more efficient,’” he said. “I’m delighted to turn over the bank. It’s healthy and in good shape, and having these guys running it makes me sleep well at night.”
After the Randolph Bank deal closes, BNC, now with more than 600 employees, will be the fourth largest bank in North Carolina headquartered in the state, behind Bank of America, BB&T and First Citizens.
“We’re very proud of what we’ve built,” Callicutt said.