Ace Bankers

Ace Bankers

banks by Janet Leiser | Senior Editor

With the largest community bank capitalization in state history, American Momentum plans to become "Florida's Bank." With money and experience, it might be big sooner than later.

Card players might say start-up American Momentum Bank holds a royal flush and the deck is stacked in its favor.

An entrepreneur with deep pockets, a longtime prominent Florida banker, a university president, a successful developer and former U.S. senator sit on the bank's board of directors. Then you have the veteran bankers that have been hired for each location.

And the game's just starting.

With $100 million in start-up capital - the most ever raised by a Florida bank, Donald A. Adam, the chairman and chief executive officer, and Sam A. Davis II, the president and chief operating officer, have recruited some of the brightest and best-known bankers in Florida to lead operations for American Momentum in Naples, Tampa, Orlando and Sarasota.

"People ask me how long it took to raise $100 million," Davis, 59, says in a soft-spoken manner. "I tell them all of five minutes."

Adam provided all of the $100 million in startup capital, though he sells it as others join. He now has about $89 million in the bank.

Adam and Davis are a proven thing in banking, though not on the same team.

A couple years ago, Adam sold a Texas bank he built over 16 years to Citigroup Inc. for more than $1 billion. As a member of the executive team that built Barnett Banks from $3.5 billion to more than $48 billion, Davis played a significant role in one of Florida's most successful homegrown bank stories.

Are they poised to do it again?

Adam, who provided nearly $90 million in startup capital, says that's his intention and the reason he hired Davis and so many other former Barnett bankers.

"I'd always followed Barnett Bank," Adam says. "I enjoyed the personal service and Florida roots. I thought they did a marvelous job. One of the things I wanted to do was try to replicate the business model. I felt the key to that was to associate with as many former Barnett alumni as I possibly could. Sam was one of those. Most all of our senior people are former Barnett associates."

Orlando attorney John P. Greeley, who specializes in the formation of de novo banks, says: "If you look at their board, it's a who's who in their respective communities. In Don Adams, you have an individual who's unique and special in his accomplishments. You'd be hard pressed to find someone to match his track record. In Sam, you have an individual who has banked Florida for many years, both in good times and in bad."

Greeley represented American Momentum in getting its application approved by state regulators last year.

American Momentum opened its doors on Oct. 25, 2006. Seven months later, the bank has six locations. Within a few months, the bank expects to have its name on a 15-story building in downtown Orlando, called The Capital Plaza II, and it will open a full-service office in downtown Naples, as well as Lakewood Ranch in Sarasota.

"We have four fully functioning banking centers, two loan production offices, two approved for full facilities as soon as construction is complete, and we have 10 other sites under active negotiation," Davis says.

"We're about a year ahead of schedule," he adds.

American Momentum plans to have a presence within five years in all seven of the state's major markets - Tampa Bay, from Pasco to Manatee counties; Southwest Florida, Lee and Collier counties; Miami-Dade; Broward; Palm Beach; greater Jacksonville; and Central Florida.

"We told regulators we'd be in four of the seven by the end of our first three years," Davis says.

The bank's target customers are commercial businesses with revenue between $3 million and $250 million, from real estate developers to business owners, professionals and entrepreneurs who are either investors or active builders.

Adams, 71, is a well-known figure in Texas.

His Bryan, Texas, holding company, Adam Corporation/Group, had stockholder's equity of more than $1 billion in late 2005, according to state banking records. He also owns property in Florida, including a 370-acre thoroughbred horseracing farm south of Ocala and property in Tampa.

In Texas in the late 1980s, during the savings and loan crisis, Adam acquired 11 failed financial institutions, plus three that had troubled assets. It took about nine years to resolve the S&L's problems on behalf of the Federal Depository Insurance Corp. But under Adam's control, the institutions were eventually merged into First American Bank and became a community commercial bank rather than a traditional thrift.

From 1998 to 2004, First American became profitable, growing from $2 billion to $3.6 billion in assets and 107 locations. Citigroup, the largest financial institution in the world, bought First American Bank in 2005 to use its branch system as its primary platform to enter Texas.

As for Adam's ties to Florida, other than the horse farm, which also grows Live Oak trees and raises cattle to sell, and American Momentum, he's a passive investor in a Florida state-chartered commercial bank created in 2002. Plus, he owns Reliable Reports Inc., which performs data verification services in 38 states, including Florida, on behalf of property and casualty insurance companies.

Who's who

American Momentum's Tampa Bay directors include Judy Genshaft, president of the University of South Florida; renowned Republican Mel Sembler, a former U.S. ambassador and chairman of the Sembler Group, Lee Arnold Jr. of Colliers-Arnold, and former U.S. senator Connie Mack.

Recruiting experienced bankers for new locations hasn't been a problem, Davis says (see sidebar). The bank has the ability to pay well because of its large capitalization. Plus, the caliber of its board helps sway would-be employees.

"We have some of the best professional bankers that there are in Florida," Davis says. "Most of whom have come from the major banks with years of experience."

And it isn't cheap to hire veteran bankers with proven track records.

"You invest more up front," the president says. "But in the long run you get much more back in return."

Why would successful bankers with two or more decades of experience change banks? For one, they're getting in on the ground floor of a bank that plans to have a statewide reach.

Another primary reason, Davis says, is "we're building to stay, not to sell. We wouldn't have the quality of people join us that left very successful careers at major institutions if they thought we'd be sold."

A bank that's not for sale is hard to find in Florida's banking climate today where community banks fetch a high dollar from out-of-state banks.

Of course, most bankers say the same thing when a bank is new or before the right price is offered.

"That is the goal of most banks to build and sell," Davis acknowledges. "That's the way the shareholders get their return so it makes perfect sense. In our case we have constructed the bank so shareholders get maximum returns without selling."

Only insiders own American Momentum stock, he says. And they'll receive money on an annual basis.

As for the CEO, Davis says, "He's a very long term investor. He builds companies to hold them for long periods of time. He's not a build it and sell it kind of guy. He's a builder, not a flipper."

Key West to Pensacola

Adam says he planned to start American Momentum for several years prior to getting it going. He met Davis after he began a search for a president. Acquaintances introduced the two.

"He was looking for someone who had been throughout all of Florida's major markets," Davis says.

At one time or another, Davis had been responsible for all metro markets from Key West to Pensacola. He spent 17 years at Barnett Bank until it was sold in 1998.

In 2001, Davis retired from Bank of America and started a consulting business. He'd just sold his longtime St. Petersburg home and was living in the Denver area when he met Adam.

Since the bank plans to cover all of the state's urban areas, Adam and Davis chose Tampa for its headquarters. The area's central geographic location makes it a fairly quick drive to most other areas, he says.

The bank's headquarters occupy 21,000 square feet on the second floor of Urban Centre I, one of the most popular office buildings in the Tampa Bay area. It's only a few miles from Tampa International Airport.

Many people, including Adam, have compared American Momentum, whose mission is to become "Florida's Bank," to Barnett Bank.

But unlike Barnett, American Momentum doesn't plan to grow primarily through acquisitions, Davis says, adding, "We're not saying we wouldn't do some. But predominantly we expect to grow organically."

There really aren't many affordable takeover targets these days since most banks are larger and statewide, he says, adding: "The consolidation opportunity is not as great as it was back then."

Growth without substantial acquisitions obviously takes longer.

In fact, one of American Momentum's biggest challenges, Davis says, is finding the right locations for new branches. It can be a costly and time consuming process.

While Davis is in charge of operations, Adam makes sure the bank sticks to its strategy and he's bringing in new business by calling the chief executives of targeted companies.

"I spend almost all of my time making calls," Adam says. "We are targeting our customers. We're not shooting with a broad-scope."

Both Adam and Davis say customer service is key to the bank's success.

In fact, most of the bank locations won't use the typical teller counter. Instead, customers sit in an office and have a bank employee take care of all their transactions, from deposits to loans.

If the bank maintains the service it strives to provide, Adam says all else will take care of itself.

"We have to take care of our customers in an impeccable manner," he says.

Much of that service will involve online banking, including remote deposit that allows businesses to deposit payments from the comfort of their own office, day or night.

Inexperienced need not apply

American Momentum Bank President and Chief Operating Officer Sam A. Davis II says the bank is hiring veteran, successful bankers to ensure success.

An initial capitalization of $100 million, the largest in Florida's history, has helped the bank to recruit. The reputation of those on the board of directors, from Naples to Tampa, is also a plus.

Bankers on board so far:

• Michael Crowe, president, American Momentum's Tampa Bay area. He has more than 20 years experience with Barnett and Bank of America.

• Maureen Gallagher, senior vice president, was in charge of treasury cash management with Bank of American for more than 20 years.

• Vicki Parker, senior vice president, was a commercial lender for 20 plus years with Barnett and Bank of America.

• Chief Financial Officer William R. Falzone was CFO of Republic Bank, among others.

• Rita J. Lowman, chief administrative officer, was also a senior executive with Regions Bank, as well as Bank of America, where she oversaw 1,000 banking centers in Florida.

• John D. Clark, president Southwest Florida, American Momentum, Naples, has 20 plus years experience. He was a senior officer with Barnett and a president at AmSouth.

• Eric Waldron, senior commercial executive, Orlando.

• Donice Dawson, vice president, Naples banking center sales manager.

• Jake Stephens, senior vice president, business/premier banker.

REVIEW SUMMARY

Who. Donald Adam and Sam A. Davis II

Locations. All of Florida's seven major markets

Key. Bringing on veteran bankers to lead the way.