Branching Out: Hometown bank enjoying some rapid growth
July 28, 2016 at 4:25 p.m.
Something old, something new, a place to borrow and a sign that's blue.
It's a twist on an old adage, but it describes some of the goings on at Lake City Bank, where growth is spreading "like gravy on a silk tie."
During the third quarter of this year, LCB acquired nine bank branches from three separate purchases. Also, the banking organization has built 17 new facilities since 1982, with the most recent opening in Granger, the Mishawaka branch set for this month, and the Plymouth office scheduled to begin operations in the spring. At that time, LCB will have a total of 44 offices.
R. Douglas Grant, president of LCB, attributes much of the local growth to big banking industry's lack of small communities in its strategic plan.
"People still like personal service," Grant said. "They like to be recognized. They like to be called by name." He said that Lake City Bank is able to keep its small-town goodness while, at the same time, offering technology and services equivalent to that of bigger banks.
Grant points out that it has never been LCB's plan to grow too big too fast and that the "flurry of acquistions" was "not of our choosing ... it was the big banks' choice to move out."
The acquisition of the NBD office in Huntington was sought after and, Grant said, the offer to purchase six branches from KeyCorp came almost within a day of finalizing the NBD branch. "It just made sense," Grant said, pointing out that the offices - in Columbia City, Kendallville, Ligonier, Logansport, Medaryville and Rochester - are within or on the fringes of the current circle, which is headquartered in Warsaw ande spreading out to reach neighboring communities. Grant said that he sees LCB's growth like dripping gravy on a silk tie - "you know it's there and, every now and then, you look down and it's bigger."
The KeyCorp acquisition required raising capital and that was accomplished by selling $20 million in preferred stock. A little money left over from the stock sale was used to purchase the Peru and Greentown offices of National City Bank, which called when "we no sooner closed" on KeyCorp. The thought was, Grant said, that LCB either move on the purchase or the offer would be gone forever. "It was a one-shot opportunity," he said.
Even though LCB is experiencing some rapid growth, Grant said that "we haven't forgotten the people. Banking has gone high-tech - we have it and we plan to progress." The people don't seem to mind the changes because, Grant said, there has been little customer turnover during the transitions.
"We can look like Chase Manhattan, but we're still making the niche with convenient location and personal touch," Grant said.
The banking industry is under siege by nonbank competitors, including insurance companies and credit unions, Grant said, adding that these institutions don't pay the same taxes, etc., as banks, and he believes that the banking industry is under-regulated.
Grant said he foresees more banking chains in the future and sees Lake City Bank as a niche in the hometown.
One way to do this is to keep local money local - he said that 99.9 percent of loans made by LCB are kept in the market area. Another, seemingly insignificant, way is to provide "warm" surroundings for LCB customers. Most of the offices are furnished with antiques chosen by Grant and his wife.
Buying and building new bank branches takes a lot of advance work, according to Grant and Jean Northenor, a LCB senior vice president.
Customers are notified of the buy-out about five weeks prior to taking over, and then a team works to make the conversion as easy as possible. When the NBD bank in Huntington closed on Oct. 31, it was a smooth transition when it reopened Nov. 3 as Lake City Bank, Northenor said.
Building the new locations has also been very successful, Northenor said. "Most banks don't want to start from scratch," she said, but LCB continues to do so and build solid customer bases.
Northenor points out that while the institution has shown growth and success, it isn't all because of the banking officers. "We have such exceptional, wonderful people - from Doug (Grant) to our clerks. ... It helps us to grow because customers are pleased with our service." [[In-content Ad]]
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Something old, something new, a place to borrow and a sign that's blue.
It's a twist on an old adage, but it describes some of the goings on at Lake City Bank, where growth is spreading "like gravy on a silk tie."
During the third quarter of this year, LCB acquired nine bank branches from three separate purchases. Also, the banking organization has built 17 new facilities since 1982, with the most recent opening in Granger, the Mishawaka branch set for this month, and the Plymouth office scheduled to begin operations in the spring. At that time, LCB will have a total of 44 offices.
R. Douglas Grant, president of LCB, attributes much of the local growth to big banking industry's lack of small communities in its strategic plan.
"People still like personal service," Grant said. "They like to be recognized. They like to be called by name." He said that Lake City Bank is able to keep its small-town goodness while, at the same time, offering technology and services equivalent to that of bigger banks.
Grant points out that it has never been LCB's plan to grow too big too fast and that the "flurry of acquistions" was "not of our choosing ... it was the big banks' choice to move out."
The acquisition of the NBD office in Huntington was sought after and, Grant said, the offer to purchase six branches from KeyCorp came almost within a day of finalizing the NBD branch. "It just made sense," Grant said, pointing out that the offices - in Columbia City, Kendallville, Ligonier, Logansport, Medaryville and Rochester - are within or on the fringes of the current circle, which is headquartered in Warsaw ande spreading out to reach neighboring communities. Grant said that he sees LCB's growth like dripping gravy on a silk tie - "you know it's there and, every now and then, you look down and it's bigger."
The KeyCorp acquisition required raising capital and that was accomplished by selling $20 million in preferred stock. A little money left over from the stock sale was used to purchase the Peru and Greentown offices of National City Bank, which called when "we no sooner closed" on KeyCorp. The thought was, Grant said, that LCB either move on the purchase or the offer would be gone forever. "It was a one-shot opportunity," he said.
Even though LCB is experiencing some rapid growth, Grant said that "we haven't forgotten the people. Banking has gone high-tech - we have it and we plan to progress." The people don't seem to mind the changes because, Grant said, there has been little customer turnover during the transitions.
"We can look like Chase Manhattan, but we're still making the niche with convenient location and personal touch," Grant said.
The banking industry is under siege by nonbank competitors, including insurance companies and credit unions, Grant said, adding that these institutions don't pay the same taxes, etc., as banks, and he believes that the banking industry is under-regulated.
Grant said he foresees more banking chains in the future and sees Lake City Bank as a niche in the hometown.
One way to do this is to keep local money local - he said that 99.9 percent of loans made by LCB are kept in the market area. Another, seemingly insignificant, way is to provide "warm" surroundings for LCB customers. Most of the offices are furnished with antiques chosen by Grant and his wife.
Buying and building new bank branches takes a lot of advance work, according to Grant and Jean Northenor, a LCB senior vice president.
Customers are notified of the buy-out about five weeks prior to taking over, and then a team works to make the conversion as easy as possible. When the NBD bank in Huntington closed on Oct. 31, it was a smooth transition when it reopened Nov. 3 as Lake City Bank, Northenor said.
Building the new locations has also been very successful, Northenor said. "Most banks don't want to start from scratch," she said, but LCB continues to do so and build solid customer bases.
Northenor points out that while the institution has shown growth and success, it isn't all because of the banking officers. "We have such exceptional, wonderful people - from Doug (Grant) to our clerks. ... It helps us to grow because customers are pleased with our service." [[In-content Ad]]