Former thrift takes up Montana state bank charter

Opportunity Bank of Montana, Helena, took 2014 to finish re-imagining its operation from the inside out..Formerly American Federal Savings Bank, the former thrift began the process of converting to a state chartered bank about six years ago, said Gary Peterson, Opportunity president. The thrift wanted to diversify its portfolio away from mortgage lending and into more commercial and business lending. The board held a strategic planning retreat and decided to add commercial expertise. They sought out talented bankers, put them in place, and started changing the business model from within.."As a thrift there is a qualified lender test that you have to perform every quarter that states you need to have about 65 percent of your assets in mortgage related investments," Peterson said. "Some other things qualify for that, but it becomes very limiting on your balance sheet when you're trying to become more like a bank. ".The former thrift also found itself more or less exclusively competing against banks. As the mix on the balance sheet shifted, the move to a state charter became necessary. In 2010, the bank converted to stock ownership.."We knew that within the next several years we'd want the state charter," Peterson said. "The final kicker was the Dodd-Frank legislation made the thrift charter less attractive in the long run.".The name change then came into play. Peterson said this was perhaps the most difficult part about the conversion since the name would have to be scrapped entirely. The $549 million bank wanted its name to demonstrate its state roots, so 'American' was out. State banks are not allowed to use the word 'federal,' and non-thrifts can't use 'savings' in their names.."There was also already another bank in the state called American bank, so we weren't left with too many options," Peterson said. "One of the things we found out over the course of the last few years in our market research was that even though we've been in Helena for 92 years, because of the American Federal name a lot of people, even some of our customers, weren't aware we were a Montana institution. It's important now, especially since the financial crisis, for people to deal with a local institution. We looked for a name that spoke to the state and to what our philosophy is and how we treat customers and communities. Opportunity Bank really speaks to who we are and what we want to project.".Peterson said the adjustment to move from the old established name has taken time for both employees and customers. "But we're all excited and getting some good feedback from the communities," Peterson said. "There were people who were taken aback and surprised with the name change. Change can be difficult, and we recognize that. When we get a chance to explain why we needed to change our name and charter it helps. It's not something you can really do in a 30-second sound bite. ".Michigan bank merger one of more to come.Chemical Bank, Midland, Mich., has completed an acquisition of the $862 million Northwestern Bank, Traverse City, Mich. The combined $7.4 billion bank operates 182 branches across 46 counties in southwestern, central and northern Michigan.."I would say it's taken us a while to get to the finish line here on the close," said David Ramaker, Chemical president. "But our two teams have been working very well together. And I believe that the cultural fit is very strong.".Ramaker said he is anticipating an increase in acquisitions of this stripe in Michigan.."I would say that the conversation is just continuing to increase," Ramaker said. "We continue to be made aware of the potential opportunities. I continue to have conversations specifically with other CEOs about what the landscape looks like.".Suburban Chicago banks merge.Pan American Bank, Melrose Park, Ill., has acquired the $50 million Bank of Palatine, Ill. The move expands Pan American's reach into the northwest suburbs of Chicago and increases its asset size to $288 million..The Bank of Palatine, founded 40 years ago, was being courted last year by the $192 million STC Capital Bank, Saint Charles, Ill., but that deal never materialized. With completion of the deal, Bank of Palatine President Winn C. Davidson has retired. The other 40 employees of the bank are expected to retain their positions..Pan American is led by co-CEOs. Nicholas S. Giuliano is the chairman and focuses on business strategy, while Frank C. Cerrone serves as the company president and handles operations.."This merger provides us the opportunity to expand our high level of service to clients throughout the Northwest suburbs," Giuliano said. "It also represents the next step in our strategy to continue to grow and expand our banking franchise and our brand."