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Greenville Business Magazine

One Bank’s Sweet Spot

Apr 03, 2017 04:43PM ● By Makayla Gay

By John Jeter

Photography By Greenville Headshots

On Valentine’s Day, a visitor to Southern First Bank steps off the second-floor elevator, where he’s greeted with a spontaneous cheer. Not because he’s with the bank’s CEO, but because … it’s Valentine’s Day. Three young employees, who look and sound like cheerleaders for a winning college football team, are handing out small cellophane gift sacks of candy to everyone in the office: one Twix and four Hershey’s Kisses each.

“I didn’t tell them to do that, but they feel a freedom in this culture to care about each other,” says Art Seaver, 53, who co-founded the bank in 1999 on Greenville’s Haywood Road in “the best triple-wide banking facility in the history of banking.”

Southern First started with $11.5 million in capital and, Seaver says, “three or four key bankers who had always been in this market.” Today, the bank is the state’s third largest headquartered in South Carolina, with $1.2 billion in deposits. Shares in its holding company, Southern First Bancshares Inc., rose 450 percent from their $4.55 basis through this February. Today, around 200 people work at Southern First’s 11 offices—they don’t call them branches—in four cities in two states.

“This is the unusual story,” says Fred Green, president and CEO of the 116-year-old, Columbia-based South Carolina Bankers Association, which represents 75 financial institutions statewide. “It’s not that they’ve grown organically—a lot of banks do that—but the unusual story is that they have grown within a fairly short period of time only through organic growth.”

That is to say, banks commonly expand through acquisition; Southern First hasn’t bought any competitors. And competition is fierce in Greenville, a $10 billion deposit market—less than half the size of Raleigh’s. In each city, more than 30 banks compete, including major marquee names, never mind the internet’s disruptive financial ecosystem.

“We’ve grown one ... client ... at ... a time,” Seaver says, pacing his words to illustrate the philosophy of the bank that has just nine locations in Greenville, Columbia, Charleston, and, as of last January, Raleigh, N.C.

“We’re a service-driven corporate culture—to each other, how we treat each other, to how we interact with customers,” says Jonathan Taylor, executive vice president in Raleigh. “That’s pretty unusual in any business, especially in banks.”

Taylor, 46, joined Southern First last year, plucked from the $24 billion-deposit Triangle market. Seaver and his team hire bankers not just with talent, but with roots in their own hometowns.

Says Seaver: “I’ve got bankers in Columbia, bankers in Charleston, bankers in Raleigh. Art can’t be successful in Columbia, it takes a long time to know the market, and build a clientele. Why would I take somebody who’d been successful in Charleston and move them to Greenville?”

Taylor, a Statesville, N.C., native who started in banking in 1996, agrees with that recruiting tenet.  “I think that is important. I’m not the Greenville guy. I don’t know that market, I don’t know that culture. I think every community’s unique. There’s no substitute for that.”

To that, Green adds: “Going back to organic growth, you’re building your culture by bringing in folks that buy into your culture, to be voluntarily part of it. I think that’s where the successful execution of it has been.”

The proof appears in the NASDAQ pudding: Southern First’s ticker, SFST, shows a stock price of around $7.40 in June 2012 and $33.80 at the Feb. 27 bell. By comparison, South State, the largest bank headquartered in the Palmetto State, saw its share price rise from around $35 to $90.90 during that same period; the bank, founded in Columbia in 1933, showed $7.2 billion in deposits ending 2016’s third quarter, according to the FDIC.

From Valentine’s Day on, the sweet spot remains the customer’s accessibility to the banker, Seaver and Taylor say.

“Who’s your banker?” Seaver, a 1986 Clemson grad, asks. “Some people would say, ‘Well, it’s Wells Fargo or it’s Bank of America or it’s South State.’ And I’d say, ‘That’s not what I’m asking, I’m asking, ‘Who is your banker?’”

With technology leveling institutions’ interactivity to a touchpad playing field, Seaver says having personal access isn’t just its growth model, it’s Southern First’s raison d’être.

“Let’s say you need $10 million or you simply lost your debit card,” he says. “Who’s your banker? I think people appreciate the fact that their banker will be there tomorrow, that their banker will have the authority to handle everything they need, and that their banker calls this market their hometown.”