2 min read December 2023 — In an interview with Invest:, Travis Bailey, senior vice president and regional executive of First Bank, discussed the bank’s growth through acquisitions, strategic adaptation to market conditions, significant community contributions and the navigation of economic challenges and technological disruptions, all while maintaining a deep commitment to their diverse client base and community values.
What has been keeping First Bank busy over the past year?
Over the last 12 months, it’s been truly interesting. From a corporate perspective, we’ve experienced significant growth, primarily due to our successful acquisition of Select Bank & Trust as well as continued organic movement within the markets that we serve in NC & SC. The specific acquisition with Select Bank brought us new employees and branches and we’re continuing to achieve success through it.
Additionally, we recently finalized our acquisition of Grand South Bank in Greenville, SC. What makes this situation intriguing is that we’ve executed both of these mergers over the past 12 to 18 months. The remarkable aspect is that, with the Select Bank merger, we had significant market crossover and synergy. However, the scenario with Grand South Bank has been quite different because we had no market share in any of those markets. While we had a presence in South Carolina areas like Florence and Dillon, we lacked exposure in Charleston, Columbia and Greenville.
The acquisition of Grand South Bank has now given us a foothold in the SC market, providing us with a valuable customer base to expand upon. Grand South Bank was approximately a billion-dollar institution, so when you combine their client base—essentially the clients we would have targeted for organic growth—with our $12 billion bank and the substantial infrastructure investments we’ve made in Treasury and retail platforms, there is a wealth of opportunity for organic growth.
In terms of our major metropolitan markets, which include Charlotte, Raleigh, the Triad, Greensboro, Wilmington and Asheville, all of them have continued to experience robust growth, even during the last couple of months. We’ve been successful in acquiring new clients, although increasing market share in markets like Raleigh, Charlotte and Asheville, where larger institutions dominate, can be challenging. Nevertheless, we’ve excelled in these markets by effectively conveying our story. Being based in North Carolina, with our headquarters in Southern Pines, has truly worked to our advantage.
What services are experiencing the most demand among your clients?
From a service perspective, First Bank has made substantial investments in our Treasury platform. This investment has led us to focus heavily on operating companies in our market. Historically, First Bank has been more of a generalist bank, with our business development teams dedicating significant time to both operating companies and real estate opportunities.
While we aim to maintain this banking tradition and empower our business development teams to grow in all sectors, we are adopting a more strategic approach in our metropolitan markets. In these markets, we are assigning specialized lenders to focus on specific areas. Our Treasury platform continues to expand, allowing us to reach out to clients we couldn’t have engaged with just two years ago due to resource limitations.
A great example is our bank card product. We offer a robust rewards program to our commercial clients and what sets us apart is that we own, maintain and service our credit card product. This level of ownership is uncommon, especially for banks our size. Consequently, we excel in handling issues related to points, user management and credit limit adjustments. This has become a significant success story for us.
What strategies has First Bank employed to continue providing valuable services to their customers?
I’ve been with First Bank for 17 years, witnessing our growth from a $2 billion bank to an over $12 billion institution through acquisitions and organic expansion. We excel in not reacting hastily, expanding one customer at a time in areas like Raleigh and seeking alignment of values, which provides us agility in uncertain economic conditions. We say it all the time but our Culture truly is what sets us apart and what, we humbly think, attracts people to us.
The current interest rate environment is challenging, yet we continue to grow our deposits, partly due to being relatively new in larger metropolitan markets, allowing us to share our compelling story. Managing net interest margin and staying competitive have been significant challenges, but our leadership team is focused on supporting clients and concentrating on the long-term outlook, especially for the second half of 2024. Emerging stronger from this cycle testifies to our commitment to acquiring new clients.
Strategically, this remains our main priority. Despite higher loan and deposit rates, we stay steadfast in providing our clients with the right advice and advancing together.
What regulations or policies are you closely monitoring?
We are keeping an eye on the CFPB and the potential changes they’re considering regarding small business credit. First Bank is deeply committed to serving small businesses. Most of the markets we operate in and the types of loans required in those markets, fall into the small to mid-sized business category. Even in markets like Raleigh, Cary, Asheville, Charlotte, or Wilmington, our primary clients are small to mid-sized companies because that’s where we can have a significant impact. This doesn’t mean we don’t work with larger companies; we definitely have the capacity to and do that, making a meaningful difference for them. However, it’s the small to mid-sized companies that sometimes get overlooked and we actively seek opportunities to truly partner with them and make a difference. That’s our focal point.
So, when we hear about developments in the political climate, especially how the CFPB is managing and approaching these matters from a more retail-based perspective, we pay close attention. In terms of the commercial real estate landscape, with economic uncertainties affecting interest rates, we remain tuned in to what’s happening. Our balance sheet is not heavily weighted towards large office spaces, so many of the concerns in the market don’t have a significant impact on us.
How does the bank give back to the community it serves?
This deeply resonates with our identity, both corporately and locally. In markets like Raleigh, we dedicate around 75% of our marketing budget towards our community, actively supporting nonprofits, particularly those fostering financial literacy and aiding children with disabilities.
In 2022 and 2023, we received the Corporate Philanthropy award from the Triangle Business Journal, aligning with our commitment to sharing our success. Our CEO, Mike Mayer, emphasizes that growing larger enhances our capacity to support our communities, which are integral to our existence. We view banking as a noble profession, with giving back being fundamental to our identity.
The award is just one aspect of our dedication. Our “Power of Good” initiative, addressing issues like child hunger and supporting educators, plans to distribute over $1,000,000 in 2023 to nonprofits aligning with our community-centric goals.
Illustrating our dedication, we commemorated Sharon Shaw Adams, a former Service Excellence Champion and her passion for volunteering at the Fuquay Emergency Food Shelter, by contributing an unbudgeted $5,000 to the organization and planning a bank-wide food drive, showcasing why we are committed to such endeavors.
Are there any emerging technologies that are shaping the future of banking?
I often refer to it as the “Fintech disruption,” and please note that it’s not necessarily a negative observation. Technology is continually reshaping the conventional banking experience, particularly for retail clients. It’s also transforming the landscape for commercial clients, particularly in the realm of Treasury cash management, in ways we might not have even imagined yet.
For instance, on the retail client side, think about the convenience of depositing a check by simply taking a picture of it within your mobile app. These kinds of product enhancements are likely to persist and First Bank is committed to remaining at the forefront of these advancements. One of our core principles is to provide clients with the flexibility to bank when, where and how they prefer, often enabled by technology through their mobile devices.
However, amid this technological evolution, one crucial area we must keep a close eye on is fraud. In the financial industry, we invest considerable time and effort in discussions and strategies to combat the prevalence of fraud. It’s an ongoing challenge and hardly a day goes by without conversations about various types of fraud – from check fraud to ACH fraud, fraud related to cash platforms and cash transfers and even credit card fraud. While technology offers the potential to improve our defenses, it also opens new avenues for fraudsters. Therefore, we remain focused on finding opportunities to protect our clients against these threats.
What is your outlook for First Bank and the Triangle’s banking sector for the near future?
While I sometimes wish for a crystal ball to see the future, what is certain is First Bank’s unwavering commitment to our communities. We are in excellent financial shape, ready to execute in our markets amidst any uncertainty. Our commitment to our clients is steadfast, regardless of how large we become.
Economically, while strategy played a part, we’ve also been fortunate. Articles highlight extreme growth in areas like Raleigh and Charlotte and we’re ideally positioned to benefit. Due to our size, we provide a unique offering to our clients, combining technological advancements with a personal touch.
Though economic turmoil is unwelcome, we are meticulously prepared to face uncertainty and seize opportunities while supporting our clients. The environment will experience short-term volatility, but we’ll navigate through it by sticking to our strengths, leaning on our strong culture and values and leveraging opportunities arising from others’ missteps and talent shortages. Our goal remains to capitalize on the immense opportunities in this thriving region and state.
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