First Security Bank Hops After Clients

Since opening its first office in Northwest Arkansas three years ago, Searcy-based First Security Bank has been building momentum. It faced a saturated market cordoned by international megabanks and native sons.

Now it has established six locations in Washington and Benton counties and scraped out a creditable share of the business. And with an upcoming proposal to build yet another 11,000-SF office in Washington County, First Security shows no signs of tapering off its effort.

“We’re in this for the long haul,” said Taylor, who added that the bank is not for sale.

First Security has 2.8 percent of the Benton County market share and 4.7 percent in Washington County, according to the most recent public posting of Federal Deposit Insurance Corp. records. Deposits in the two counties totaled nearly $155.9 million, about 24.7 percent of First Security’s entire deposits of $630.4 million.

Statewide, the bank has $711.3 million in assets, up 11.7 percent from the previous year. Bauer Financial Reports gave First Security four out of five stars and included it on its recommended bank and thrift report.

Making “conservatively aggressive” loans bolstered First Security’s local success, said James “Jim” Taylor, the bank’s Northwest Arkansas division president. According to Bauer, the bank’s loan-to-deposit ratio is about 76 percent.

Last year the Northwest Arkansas division attracted $50 million in first-time mortgages, Taylor said. Loan charge-offs for the whole bank were about .45 percent. According to the FDIC, of the more than 3,000 banks that reported total assets of $100 million-$1 billion, the average charge-offs for loans and leases was .44 percent.

Taylor said he will submit a plan to the Springdale Planning commission on May 7 to demolish the bank’s current 1,400-SF office on Sunset Street and replace it with First Security’s signature two-story design.

Created by Gaskin Hill Norcross in Little Rock and first constructed for the First Security in Cabot, the building will feature four brick columns and a wall of green glass.

The bank got a $2 million building permit for First Security’s flagship office on Joyce Boulevard, and Taylor said the Springdale renovation would also be a multi-million-dollar project. A duplicate of the design was used to build the Walnut Street location in Rogers.

The new office could open as soon as next fall, and it will house a training center for First Security’s 50 Northwest Arkansas employees. Beefing up the Springdale location is an effort to strengthen the bank’s Washington County presence.

Pocketing New Accounts

With more than 20 banks wrestling for market share in Northwest Arkansas, First Security turned to a marsupial for help.

From toe to ear, Penny Pockets, the bank’s Kangaroo Kids Club mascot, stands taller than seven feet and appeals to people younger than 18 to start a free savings account. Prizes such as yo-yos and plastic Penny Pockets banks reward children for reaching higher savings balances.

Kids who take their First Security-branded goods to school end up referring their friends to the bank, said Tracey Jones, a First Security assistant vice president and marketing director. But that means more than opening a few new savings accounts.

Taylor said about 75 percent of the children who enroll in the Kangaroo Kids Club bring in parents who also open at least one account with First Security. Jones said the mascot soon will begin visiting various elementary schools.

Every account matters to an institution trying to establish roots in a new area. As a relatively fresh face in the local market, First Security scrambles to meet every customer service demand.

“Our goal,” Taylor said, “is to deliver the unexpected customer service … We’re not here just to take people’s money and make loans.”

Penny Pockets toys, free checking accounts for students and even dog biscuits at the drive-through windows are examples of the bank’s effort, but Taylor also named others:

• Live tellers greet customers at the banks and on the telephone.

• Individual consumers choose among seven checking and five savings accounts, and commercial customers select from four accounts.

• First Security’s Web site, www.fsbank.com, offers online banking and electronic mortgage applications.

Internet mortgage applications only recently became available for the bank. Incoming residents fill out online paperwork and apply for home mortgages before leaving their hometowns. When they arrive, newcomers only have to fill in their signatures to finish the process.

Rise and Shine

When Taylor began staffing the Northwest Arkansas division of First Security, he looked for two things: long-term employees and strong community ties.

He scouted for employees who had worked for the same bank for 9-14 years. Jones is an example, having joined First Security after working for nine years with the First National Bank of Berryville.

Even Taylor himself had been with Hibernia National Bank in Texarkana for 11 years before he took First Security’s offer.

Other employees brought First Security instant bonds with the community, such as longtime local bankers Joe Ruddell and Stewart Baguley, and Jim Watson, whose family ran Watson’s Supermarket for many years in Fayetteville.

Taylor jumped headfirst into the local social circles through volunteer work. He currently is involved with the Salvation Army, the Fayetteville Chamber of Commerce, the United Way of Washington County, the Fayetteville Public School district and the UA’s Students In Free Enterprise program.

From his bottom-floor office in the Joyce Boulevard location, Taylor can see Fayetteville’s business district on College Avenue. A television screen faces his desk, flashing scenes from closed-circuit security cameras, and a palm pilot often beeps to remind him of his next appointment.

The setting is distant from Taylor’s farm-life upbringing. Born and reared in Pottsville, young Taylor hauled hay and earned money for college by raising bottle calves for a local dairy.

He later earned a bachelor’s degree in agricultural business from Arkansas Tech University in Russellville.

Working on a farm gave Taylor his work ethic, and First Security employees joke that no one can beat him to the office. The lights come on in his office at about 6:10 a.m., and they often shine past 6:30 p.m.

First Security Bank Board of Directors

Name — Employer

Reynie Rutledge — chairman and CEO, First Security Bank

Dr. David Burks — Harding University

Larry Crain — Crain Inc.

Steve Lightle — B&B Oil Co.

John McKnight — rancher

Wayne Ridout — Ridout Lumber Co.

Dr. Porter Rodgers — surgeon

NT Rutledge — First Security Bank

Jim Tarkington — Truman Baker Chevrolet

James Wilson — president, First Security Bank

E.D. Yancey — Yancey and Associates

Source: First Security Bank