Bank of Rogers Fills Community Niche

Dick McLelland got tired of large banks buying the community banks he headed in Northwest Arkansas. After the second time it happened, he decided to start his own.

McLelland was president of Farmers & Merchants Bank in Rogers, which was bought out in 1991 by First Commercial Bank, now Regions. After that, he headed Citizens Bank of Northwest Arkansas in Fayetteville, which was bought in 1994 by Bank of Oklahoma, which is now Bank of Arkansas.

So in 1995, McLelland founded Bank of Rogers.

“I was the one who got the investors and went out and chartered the bank,” he said.

At the end of Bank of Rogers’ first year, it had $7 million in deposits in addition to the $3.2 million in capital investments McLelland used to get it started.

As of June 2001, Bank of Rogers had $80 million in deposits and 3.66 percent of the market share in Benton County (an increase from 3.28 percent in 2000). But getting big isn’t what McLelland, now chairman and CEO of the bank, has in mind.

“I don’t look at market share as much as some other people do,” McLelland said. “We try to take care of our people and grow profitably … We had some good growth. It was controlled growth, and that is what we wanted.”

Controlling growth, he said, is a matter of “managing your assets.”

“We buy money and we sell money, and we have to make a spread on that,” McLelland said.

So far, the bank has made a profit each year of its existence.

“In the beginning, we never projected to be this large at this time,” he said.

Deposits grew to $85 million during the past year, so to control growth, McLelland “shrank” it back down to keep the bank’s loan-to-deposit ratio at about 80 percent.

“When banks have excess money, they have to put it in fed funds, and fed funds were paying 2 percent,” he said.

Bank of Rogers is a community bank that’s locally owned and limits its loan size to $1.5 million. Most of the bank’s commercial loans go to small businesses and for local construction.

“We don’t make large loans to individual creditors,” McLelland said. “We’re not everything to everybody, and we don’t pretend to be … We try to know our customers as well as we possibly can.”

Many people compare Bank of Rogers to The Bank of Fayetteville, which is run by John Lewis.

“We’re similar in a lot of ways,” McLelland said. “We’re locally owned like they are. Most of our shareholders are Rogers and Bentonville residents.”

Bank of Rogers has 35 employees. The main bank is in Rogers. Branches are located in Rogers, Lowell and Centerton. Bank of Rogers is spending $350,000 to build a new 2,000-SF building in Centerton, where a mobile branch is now located. Construction should be completed by the end of the year, McLelland said.

The banking competition is fierce in Northwest Arkansas.

“The [profit] margins up here have always been less because of the competition,” McLelland said.

The soft economy of 2001 and the terrorism of September 11 “hurt a little,” McLelland said, “but we made a little over a million dollars. We made more in 2001 than we did in 2000.”