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February 2008
Sweet Spot
By Ellison Clary

    A $16 billion-asset bank operating in the backyard of the nation’s biggest financial institutions needs a niche, a concentration where it can shine.

    First Citizens Bank has such a niche and it serves the Raleigh-based institution doubly well in Charlotte, the veritable kitchen for Bank of America and Wachovia, second and fourth largest banks in the United States.

    The First Citizens sweet spot is concentrating on small- and medium-sized businesses as well as professionals, medical practitioners, financially active clients and those interested in relationship banking. Bank officers emphasize developing and maintaining a relationship approach that fits each client.

    “A bank our size can’t try to be all things to all people,” says Marc Horgan, area executive for First Citizens in Mecklenburg and Iredell counties. “Our commitment to our customers and their needs sets us apart.”

    Horgan has occupied his office in the 23-story First Citizens Bank Plaza on Tryon Street for about nine months, but he’s been with First Citizens for nine years, working in Raleigh and Cary and other parts of the Triangle.

    How does First Citizens compete in Charlotte’s banking hotbed? Horgan points to the bank’s succinct vision statement: “To help our customers achieve a lifetime of success.”

His bank defines success by its clients’ unique standards, Horgan says, adding, “We serve the depth of their financial needs from traditional bank products to our comprehensive wealth management offerings.”

    Horgan emphasizes that he depends on the dedication and expertise of each of the 170 First Citizens employees in Mecklenburg and Iredell counties.

    “We’re visible,” he says. “While our commercial team is right here in the main office, we have 13 business bankers servicing the community from their branches. Then you put the bankers together with our partners, those in merchant services, leasing, cash management, working capital finance. In a market like Charlotte, it’s a pretty unique story.”

    Horgan works in partnership with Private Wealth Advisory Services, led in Charlotte by senior vice president and managing director Scott Angel. Angel’s group focuses on providing professional asset management, objective financial counsel and an integrated approach designed to synchronize all aspects of a private wealth client’s financial affairs. For businesses, municipalities and foundations, First Citizens Institutional Advisory Services Group offers institutional asset management and retirement planning services.

    The overriding goal for Angel and his associates, according to Angel, is growing the bank by serving each individual client through what he calls their “financial life cycle.”     Angel feels he and his team can, better than any other company, guide a person from business startup through business sale: “We help clients make better financial decisions.”

Along with Horgan, Angel praises the emphasis First Citizens places on its associates and their ability to serve their clients. Ultimately, that leads to bankers with strong expertise over an extended tenure.

    “Our regional team of 13 individuals includes six Certified Financial Planners and our professionals average more than 15 years of experience,” points up Angel. “These relationship managers and partners have specific expertise in comprehensive areas of wealth management, including financial planning, investments, estates and trusts, insurance planning and private banking.”


Personal Approach to Service

    “But what really sets First Citizens apart,” Angel continues, “is that the bank encourages its associates to visit a client’s office or home.” And although Horgan and Angel and their associates knock on many doors for new business, that personal approach leads to a steady stream of referrals from satisfied clients.

    That’s how Jim Thompson of Charlotte got to First Citizens. Thompson was frustrated with bad banking experiences when he was trying to sell his interest in Agdata, a business he helped found. A friend suggested he try First Citizens.

    “They could not have been more attentive or helpful,” Thompson remembers of the 2005 experience. “When the time came that I did sell my portion of the business, I gave a substantial portion of that money to First Citizens to manage for me. They keep me apprised of how my investments are doing. If I have questions, I get answers right away.”

Thompson is now co-owner and general manager of Southeast Biodiesel, with offices in Charlotte and a production plant in North Charleston, S.C. “First Citizens has put together a couple of lines of credit for me that I have used to get my new business off the ground,” he continues.

    “The thing I really have appreciated is they’ve all been there the whole time,” he adds. “There’s not been a lot of turnover.”

    Personal attention comes natural for First Citizens, Horgan says. Though a public company traded on NASDAQ, it continues to be controlled by members of its founding family, the Holdings, who started First Citizens in 1898.

    “We’re one of the largest family-controlled banks in the country,” Horgan adds. “By the family being involved, we’re making decisions from a long-term perspective to support the bank’s vision.”

    System wide, First Citizens earned $126.5 million for 2006 and reported $82.5 million in earnings through September 2007. The bank isn’t feeling too much of a mortgage pinch, Horgan says, because it has a diverse loan portfolio as a result of providing a full range of credit services to both business and retail customers.

    Bank of America and Wachovia control 90 percent of the Charlotte financial market, so First Citizens and others, including a plethora of community banks, scramble for the remaining 10 percent. In fast-growing Mecklenburg and Iredell, that’s still a lot of business. It’s enough to make First Citizens’ Charlotte operation second only to the Triangle on a system that includes 340 branches in West Virginia, Virginia, Tennessee and Maryland as well as North Carolina.


Combining Best of Big and Small

    To mine the Charlotte market, Horgan says, First Citizens mixes the strengths of both big and small banks.

    Large banks enjoy huge reserves of resources, he explains, but they often can’t react nearly as quickly as smaller institutions. “The ability to be nimble, creative and flexible is an advantage for community banks,” he adds.

   First Citizens combines both, he says. “We’ve got the resources to support client needs, but we can also make local decisions and give our clients the long-term approach.” Executives such as Horgan and Angel have the latitude to make individual deals that larger banks often can’t accommodate.

    First Citizens has 27 banking centers in the Charlotte area and two under construction, one each in burgeoning southwest Mecklenburg and the Lake Norman area that straddles the Mecklenburg-Iredell line. That’s testimony, Horgan and Angel point out, that First Citizens is competing successfully.

    “We manage wealth relationships at the personal level,” Angel explains. “Our job is not to tell the client what to do. Our job is to proactively help clients understand what their options are so they can best make decisions for their family. If we take that perspective, then our clients will be successful, and we will too.”

    Angel gives some examples of a typical business client’s needs. Among them are children’s education and basic insurance, business succession, and estate planning. His teammates often partner with an attorney or accountant, he says, to address such concerns.

    Though First Citizens boasts $17 billion in assets under management and custody, Angel says the bank doesn’t try to produce every product and service in-house. Instead, he and his team leverage experts and technology to offer best-of-class investment services from across the country.


Strong Retention

    For proof that approach works, Angel points to a client retention rate that exceeds industry standards. “We do an amazing job of keeping clients long term,” he says.

    A client the Charlotte office has kept for more than two decades is Dale Halton, former president and chief executive of Pepsi-Cola Bottling Company of Charlotte. She sold the firm in 2005, but remains on the local First Citizens advisory board.

    Halton recalls how she established a relationship with First Citizens in 1984 and 1985 when she was renovating and rebuilding the Pepsi plant on South Boulevard.

    “First Citizens came up with the best deal,” she says. “They have been a super bank to work with. They are very personable and flexible. They want to help. I moved a lot of my personal stuff over there, also.”

    Halton sometimes is featured in advertisements extolling the virtues of First Citizens in the Charlotte area.

    “They are certainly about personal service,” she says. “It means a lot to know you can call and you don’t have to be passed around from person to person. I highly recommend them.”

    At 37 and 40 respectively, Horgan and Angel profess their preference to remain in Charlotte for years to come. What will the First Citizens presence in the Charlotte area look like in, say, five years? They sketch a broad picture.

    Horgan sees continued opportunities in the Lake Norman and Mooresville areas and other sections such as near the South Carolina border.

    Horgan says First Citizens has a strong tradition of community involvement and making cities and towns the bank serves even better places to live and work. He and Angel vow to continue their involvement in local civic affairs and encourage their associates to do the same.

    Horgan recently was elected to the Foundation’s board for the University of North Carolina at Charlotte, where he earned a bachelor’s in finance in 1993. Angel, an Eagle Scout, is on the executive board of the Mecklenburg Council of Boy Scouts of America and is an active deacon and treasurer of First Presbyterian Church.

    “We’re going to grow the bank and do it one person, one business at a time,” Horgan says. “At First Citizens, we’re committed to delivering on our promise of understanding our clients’ financial needs and goals and applying our knowledge, expertise and resources to make a difference in their lives. In other words, we value their relationships with us.”
Ellison Clary is a Charlotte-based freelance writer.
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