By: Michael Campbell | Twitter: @itsthesoup
Posted: Oct 5, 2017 | 12:00 p.m.
MCKENNEY – “If you stick to your core values and do the right thing for your customers and shareholders, in the end, things will typically turn out well for you.”
Those were the words of Bank of McKenney President and CEO Richard Liles as he opened up about the community bank’s efforts to not only survive but thrive among financial institutions in the region while discussing the upcoming merger between the local bank and South Hill, Virginia-based Citizens Community Bank.
In June, the two banks announced their intent to merge, with the combined banks creating an entity with approximately $447 million in assets, $344 million in loans, and $390 million in deposits, based on reported financial information as of March 31, 2017.
“The merger creates a larger and stronger institution with a significantly higher lending limit, expanded product offering and access to new markets,” officials said in a statement earlier this summer. “Both management teams anticipate that such enhanced scale and efficiency will create meaningful opportunities to drive further growth, profitability and long-term value creation for employees, customers, and shareholders.”
In an interview, Liles discussed how the merger with CCB will help Bank of McKenney and its over 60 employees reach the goals the 100-plus year banking institution has for the future.
“I truly think this is a great thing for both banks,” he said. “It is going to give us the size that we need to stay independent and remain a community bank while continuing to compete.”
Liles referred to the importance of the word “community” in the phrase “community bank” often, discussing how important it is to “know your market and know your people,” noting that the institution being acquired by Bank of McKenney does have local connections to the area with CCB’s CEO James Black having lived in Matoaca.
“You are still going to get the same great service you have been and the decisions will still be made locally,” Liles said. “It is very important to respond to our customers, whether it is a yes or a no.”
As part of the upcoming merger, officials for both banks settled on the name Touchstone Bank as the new name for the combined institution, pending shareholder approval. In a letter, officials with the bank said, while the two banks’ individual names have “served us well,” they “felt the union of the two banks needed a new name.”
“We wanted the name to reflect our future growth and shared commitment to the high quality of customer service that both of our banks are so proud to provide in our respective communities,” they continued, which yielded the name “Touchstone,” referring to when a touchstone was used to test the purity of gold and silver.
“Today, anything that tests the standard of quality is considered a touchstone,” they said. “When our two banks join forces as Touchstone Bank, we intend to elevate the standard of community banking to a higher level of quality and service.”
Those thoughts were echoed by Liles as he explained the story behind the selection of the bank’s new name.
“This exciting brand aligns with our shared commitment to provide all customers with exceptional, ‘high touch’ service by a trusted team of experienced, local personnel,” he remarked. “Together, our banks have been building a legacy for over 125 years and we’ll make history again this year as Touchstone Bank.”
Over those decades of service to thousands of local banking customers, the Bank of McKenney has weathered financial storms, remaining resilient where some banks faltered, such as during the 2008 financial crisis.
According to a report from the United States Government Accountability Office, between January 2008 and December 2011, the height of the financial and housing crisis, “414 insured U.S. banks failed” with 85 percent, or over 350, of those banks being small institutions with less than $1 billion in assets.
For Liles, it was the community banking values that helped Bank of McKenney navigate through those times and come out on the other side successful and growing.
“You have to stick to your core values and your community banking values,” he said. “You’re going to take some bumps and bruises just like everyone else, but we were extremely pleased and proud of how we succeed during a lot of the banking turmoil.”
Upon the merger’s completion, Touchstone Bank will be made up of 13 full-service offices and a loan production office in Chesterfield, Dinwiddie, Prince George, Brunswick, and Mecklenburg counties in Virginia, along with Franklin, Halifax, and Vance counties in North Carolina, headquartered out of Prince George, moving from their offices in McKenney to help increase efficiencies through consolidation of operations and management.
With the merger, Liles sees Touchstone Bank filling a void that is not seen as much with larger, national financial institutions.
“Typically with the larger banks, you’re kind of in a box,” he said. “I don’t see us as competing so much with the large banks as much as complementing them because, it’s sad but, you see the large banks closing and moving out of the smaller areas, rural and urban, but, for us, they’re our bread and butter. We are the community, we use the community, we support the community, We hire the businesses, we employ them and we use them because that is what we are; a community bank.”
For Bank of McKenney’s customers, Liles said they can expect the same service they’ve become accustomed to at their branches before, during, and after the merger’s completion, which is expected by the end of this year.
“There isn’t going to be any change to Bank of McKenney’s customers,” he said. “You have the same routing number and your checks are still good and you will get the same great service. I think this shows that we have done what we needed to do to be able to survive and serve you into the next year and the year after.”
“Our intention is to be one of the survivors of the community banks,” Liles stressed.
Going forward beyond the merger, Liles added that he is optimistic about the combined bank’s future, adding, “We think we have a lot of adjoining markets that would welcome us” when asked about expansion plans, noting areas north and west of their current footprint as being eyed.
As part of the process, the merger is awaiting regulatory approval and shareholders are expected to meet in early November to approve the name.