Bank finds opportunity in industry upheaval

Mergers and acquisitions consultants and attorneys in the banking sector have been as busy as lifeguards in a non-pandemic summer, working on multiple deals with an outsized impact on Florida.

The list includes First Horizon buying IberiaBank and South State merging with Polk County-based CenterState, both which recently closed. On a more local basis, Stuart-based Seacoast National Bank’s $40 million acquisition of St. Petersburg-based Freedom Bank closed Aug. 18. And the big one, of course, is BB&T and SunTrust, a $66 billion merger that created the sixth largest bank in the country by assets, with $460 billion, under the name Truist.  

Just like in other periods of consolidation, the flurry of deals creates opportunities for bankers who believe there’s market share for the taking when customers get lost in the transitions. Southwest Florida bankers Marty Mahan and Brandon Box are at the top of that list, through Volusia County-based Cogent Bank. The duo is tasked with growing Cogent, with $588.2 million in assets through June 30, in the Fort Myers-Naples market. The sum of the strategy? Grow assets and loans through a community banklike approach with one-on-one service and local decision-making — backed by a bank with a presence in three other Florida markets.

‘It’s a great time for us to be out knocking on doors. I feel like this is an opportunity for a new community bank to come in and become the next great community bank in Florida.’ Brandon Box, Cogent Bank

“We think the timing is fabulous,” says Mahan, a regional banking executive with Cogent. “There’s a lot of turmoil banks are going to have to face with all the consolidations.”

Mahan, who spent 20 years with Barnett Bank, from 1978 to 1998, eventually as director of retail services, joined Cogent late last year. He recruited Box, who had been with IberiaBank for 12 years, including the last three as Southwest Florida marker president.

Noting there hasn’t been a de novo community bank launched in Southwest Florida in nearly two decades, Box adds that “it’s a great time for us to be out knocking on doors. I feel like this is an opportunity for a new community bank to come in and become the next great community bank in Florida.”

The Southwest Florida region of Cogent brought on 71 customers in August, its first month officially in business, and executives project a solid end to the year and strong start to 2021. “We don’t have the advertising and marketing budget like some of us have had in the past,” Box says, “so we are doing this with the relationships we have built over last 10, 20 and 30 years.”

Cogent’s relationship-backed approach can be traced back to CNLBank, and before that Barnett. On the latter, Barnett, Florida’s largest bank for decades, grew into a $41 billion statewide leader before it was acquired in 1997 by NationsBank, which soon became Bank of America. Dozens of Barnett alum, raving about its entrepreneurial culture and customer focus, went on to start and run other institutions. The list includes Lee Hanna, who helped grow Orlando-based CNLBank into a $1.6 billion institution before Wayne, N.J.-based Valley Bank bought it in 2015. Mahan had also been with CNLBank and then Valley. Cogent, Mahan says, is the CNLBank “band getting back together” after the Valley deal.

Cogent was previously named Pinnacle Bank. The Hanna-led team acquired the bank in 2018, when, after some struggles, the Federal Deposit Insurance Corp. had taken it over. Cogent invested $10 million at first, changed the name and soon recapitalized through a $30 million investment, expanding into the Tampa-St. Petersburg market and Jacksonville prior to Southwest Florida. Another growth-fueling capital raise for up to $30 million is underway, with the bank targeting $800 million to $1 billion in assets.  

Box says a key element of the banks’ strategy, counter to how some others have attacked a new market, is to start out with a low overhead in physical space. The bank has a 2,500-square-foot office in a small Fort Myers office park and plans to get an office in Naples, but its expenses, so far, are mostly geared toward people and technology. Box, for example, says Cogent has “the Ferrari of banking technology systems,” both internally and for customers, so it can compete better with bigger competitors.    

One element that’s so far not been much of a challenge, at least in targeting and winning new business, is the pandemic. Both Box and Mahan say they’ve had multiple in-person meetings, with business from machine and equipment loans to building purchases on the table. “We have so much opportunity ahead of us,” Mahan says, “the biggest challenge is the number of hours in a day every day.”