Locally-owned First National Bank sees impressive growth

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They’re seasoned bankers and commercial lenders who once competed for clients. Today, however, Mike League, President, and Rob Alexander, Chairman of the Board of the First National Bank of Colorado have teamed to create their own downtown full-service community bank with assets of $69 million. That figure represents more than 500 percent growth – and more than $55 million in new deposits over the last 21 months. Not bad for two hometown bankers with deep roots in the Pikes Peak region.
League, who was born in Colorado Springs, moved to Kansas City after college to go to work for United Missouri Bank of Kansas City. He returned in 1991 to head UMB’s newly acquired Colorado Springs office (formerly Valley Bank). As he grew his commercial loan portfolio and developed new customers for UMB, League faced competition from companies like Piedmont Funding, headed by Alexander. “Mike had $30 or $40 million in loan business on the books – and I had close to $60 million in commercial business at Piedmont,” said Alexander. “We knew and respected each other for years before we joined forces.”
Alexander sold his interest in Piedmont in 1995 and signed a three-year non-compete contract. Shortly after that term expired in Spring of 1999, Alexander approached League about the new venture. They joined forces on June 1,1999, as purchasers and majority stockholders in what was then the Bank of the Rockies, located on the city’s east side. Fortunately, both men had built loyal client relationships that would follow them. Customers started calling immediately, and as League said, “We asked them to hold on until we got fully-organized – but some folks pressed to start investing with us right away. I think the fact that Rob and I are both major shareholders and investors in the bank gives our investors confidence that we will work hard. After all, it’s our money too.”
The two men brought energetic management philosophies to the Bank of the Rockies, resulting in some expected employee turnover. “We came in hoping to keep a lot of the personnel, but some decided to leave. We have brought in the best in the business to take their places,” says Alexander. One of those was new management team member, Mike Herder, executive vice president, who came to First National from Bank One. Today Herder is also chief credit officer, responsible for not only for loan approvals, but for networking with the business community as well. “Everyone in our organization works on bringing in new business,” League points out, “and between the three of us, we know 80 percent of our customers on a first name basis.”
Last year, League and Alexander purchased the former First Federal Savings and Loan building from Rich Guy. As a part of the bank’s ownership transition, First National’s founders discovered an interesting opportunity. Alexander had his attorneys check regularly with the Secretary of State to determine if either of the historical names, “First National Bank,” or “Exchange National Bank,” might became available to the new owners. “Our lawyers said it was a long shot,” says Alexander, who notes that Bank One had retained the right to use the First National Bank name when it purchased the Pikes Peak and Tejon landmark financial institution several years ago. Bank One decided not to renew the registration and, in 2001, Alexander and League filed to use the nostalgia-rich local moniker.
“We’re going to do a lobby display including a lot of the memorabilia people in the community have given us with the old First National Bank logo on it,” says Alexander as he pulls paper weights, tie tacs, pens and other 1950s and 1960s paraphernalia from his desk drawers. “We like the legacy and the name we’re carrying on. Both Mike and I were trained by the best. I learned from guys like George Ackerman and Greg Ireton.” League agrees, and notes his training with Crosby-Kemper in Kansas City, a well-respected traditional banking institution.
“First National Bank of Colorado Springs is in a real minority,” says League, pointing out that there are just three other truly local banks in the Pikes Peak region. “Besides First National, there are only the Bank of Broadmoor, the Citadel Bank and Cheyenne Mountain Bank that qualify as independently-owned institutions.”
Admittedly a “basic blocking and tackling” organization with few marketing gimmicks to lure clients from other banks, First National Bank will not offer sweepstakes like the larger national institutions, says League. He differentiates First National Bank from transaction-based companies. “We are a full-service community bank,” he states. “We won’t over-reach our capabilities, but by partnering with other lenders, we can do larger deals than the typical community bank.”
League points to First National’s recent selection as the bank for the Cheyenne Mountain Zoo. The Zoo’s board of directors had interviewed a number of larger financial institutions, but in January of 2002 made its decision to go with the local group. “The Board was impressed by a local bank’s ability to find financing for our new African project,” says Susan Engfer, Zoo chief executive. “They are a hometown bank and have been very accessible.” As Alexander points out, First National serves companies that appreciate not having to go out of state for credit approvals – customers like the Boettcher Foundation, Peter Coors and a number of Colorado Springs’ premiere business owners. “It’s a little insulting for these folks to be questioned or turned down by U.S. Bank which is headquartered 1000 miles away,” League said. To date, 90 percent of the Bank’s clients are Colorado-based — and of that, 60 percent represent commercial accounts.
So what does the future hold for two young bankers with a strong commitment to their community? “We’ve just seen some of the tightest credit in years in 2001 into 2002,” says Alexander. “The big banks like UMB and Wells Fargo basically turned off small business lending once the recession hit. We have been able to continue to offer credit. Of course, we have to be careful, but our goal is to stay nimble, decisive and accessible to our customers.” The two entrepreneurs expect to continue to offer ATM service and on-line banking, although neither is highly profitable. “Only 10 percent of commercial accounts will use Internet banking,” he said, “but we still need to offer it as a service to our customers.’
In addition, League and Alexander expect to manage and grow the bank’s assets to new heights. After all, as parents and Pikes Peak region residents, they want to see Colorado Springs generate economic growth to support future generations. “We have already received offers to buy,” said Alexander, “but we’re not interested in selling. Both men agree that they value the stability and “high touch” nature of their community bank. Says League, “We did our research and determined that there was just one niche left in this industry – and that is the full-service community bank. There are lots of big box banks and credit unions in town, but every town needs a locally-owned hometown bank on the corner. That’s who we are.”