Bank of Rockbridge open
By NINA COOLIDGE
After spending two and half
years cutting red tape, the Bank of Rockbridge was finally able to open
its doors to local bank customers in December.
The newest bank in town is on North Lee Highway. It offers customers a 24-hour ATM machine, as well as Internet and phone banking services. Bank of Rockbridge is one of four banks associated with TransCommunity Financial Corporation (TCFC), a holding company in Richmond that helped handle the regulatory and capital-raising processes involved in getting the bank started.
Competition is said to be a boon to consumers. It doesn't seem to be a problem for the other bankers around Lexington either.
Nancy McCormick, teller manager at the Wachovia branch office in downtown Lexington, said that her bank and the other chains think they are more competitive than the neighborhood banks such as the Bank of Rockbridge.
For this reason, McCormick said she doesn’t think the opening of the new bank will significantly impact Wachovia. McCormick did say that Wachovia might see slight declines in business initially, but in the past, clients usually return to the larger chain bank.
“It’s a small area, but there’s a fair amount of competition,” McCormick said. “We are more competitive in terms of what we can offer and what services we can provide.”
According to McCormick, Wachovia is the fourth largest holding company in the country.
TCFC President and CEO Bruce Nolte, however, said he is not worried about finding enough business for the Bank of Rockbridge.
“We compete against the big banks in all the service areas with great success,” said Nolte. “[The large chain banks’] decision-making process is cumbersome. We can serve the customer better than those big banks.”
According to Nolte, when the original Bank of Rockbridge was taken over, it held 43 percent of the market share.
“We see tremendous opportunity in Rockbridge County,” Nolte said.
The bank has been in the organizational stages since June 2004.
According to David Grist, President and CEO of the Bank of Rockbridge, the aim of their new bank is to provide quality lending and banking services to local Rockbridge County residents.
Grist was part of the original Bank of Rockbridge that started in 1933 before it was sold in 1998 and taken over by BB&T in 2000. When Grist and Nolte joined forces to form the bank, they faced two main challenges -- raising enough capital and gain approval by all the necessary regulatory committees and commissions.
According to Nolte, TCFC and the bank's board thought they would be able to raise $5 million in capital through stock offerings solely in Rockbridge County.
After several months, however, they had only raised $3 million so the decision was made to close the stock offering and work with a firm in New York, Sandler O’Neill and Partners, to raise the rest of the necessary capital. In the interim, regulators told the bank they would need to raise eight, not the original five, million dollars.
After raising the $8 million, the board faced further hurdles to opening their bank. In the late half of 2005, regulators took issue with some governance problems at TCFC, which took another year to resolve. Nolte did not elaborate on what those governance problems were.
Finally, in August 2006, TCFC and the Bank of Rockbridge were able to refile with the regulatory commissions and received full approval in Winter 2006. Before the bank could open for business, it had to receive final approval from the State Corporation Commission, the Federal Reserve Bank of Richmond and the Federal Deposit Insurance Corporation.
The Bank of Rockbridge joins seven other banks in Lexington, including such national and regional chains as Sun Trust, Wachovia and BB&T.
Produced by Washington and Lee journalism students.
Lead supervisor: Prof. Claudette Artwick
Reporting supervisors:
Technical supervisor: Michael Todd