Patrick Deignan, Cedar Rapids market president, opens the door to Bankers Trust’s new downtown branch on the ground floor of the CRST Tower at 201 First St. SE. The bank also occupies the 11th floor of the new tower, where it has room to grow. PHOTO EMILY BETTRIDGE
By Dave DeWitte
dave@corridorbusiness.com
As Bankers Trust marks its centennial year this month in Cedar Rapids, Des Moines and Phoenix, it’s celebrating more than just longevity.
Iowa has many banks that have been in operation for more than a century – as many as 162, according to the Iowa Community Bankers Association. Bankers Trust, however, has become the largest and most profitable bank based in the state, with assets of $4.1 billion at the end of 2016, and 2016 earnings of $39.9 million.
The Des Moines-based bank has been on a growth streak since 2010, when the economy’s recovery from the recession of 2008 began to solidify. This past year was Bankers Trust’s seventh-straight year of record performance, with assets up 6.5 percent, or $254 million, after growing 8 percent in 2015.
The centennial celebration has been an important milestone to tout with advertising taglines such as “Ever admired – never acquired,” and “100 years of trust – put that in your bank statement.”
It’s a milestone that resonates with customers, according to Patrick Deignan, Cedar Rapids market president for Bankers Trust, but he’s quick to remind them it’s not the core of the bank’s identity.
“You can’t tell that we’re a 100-year-old bank when you walk in,” he said. “We’re anything but a sleepy bank.”
Mr. Deignan said Bankers Trust entered the Cedar Rapids market with a team of experienced commercial bankers, and acted more like an entrepreneurial startup than a legacy bank. He now leads a team of 50 at the CRST Tower in downtown Cedar Rapids and at 400 Blairs Ferry Road NE. In-market assets grew by $116 million, to $612 million, in 2016.
The biggest share of growth and assets has come from building strong relationships in mid-market business banking, serving businesses with 25-400 employees.
“That’s Iowa,” Mr. Deignan said. “We don’t have a lot of Fortune 500 companies.”
Bankers Trust spokesman Scott Valspar said the company is building a branch model which emphasizes meeting all of a client’s financial and banking needs in one location. It offers a full line of trust and investment services, along with commercial banking, private banking and mortgage lending.
Bankers Trust was launched on June 1, 1917, in Des Moines. Founder Benjamin Franklin “B.F.” Kauffman thought the market could use a higher level of service than what existing institutions were providing. He opened with $1 million in capital, and began building strong relationships in the community, with customers depositing $485,354 into accounts at the new bank on the first day of business. Mr. Kauffman led Bankers Trust for 30 years, before relinquishing the daily leadership role to James Hubbell.
Bankers Trust went on to acquire Des Moines Bank & Trust Co. in 1953 after the Hubbell family acquired a major stake in that bank’s stock. Then in 1960, at the Hubbell family’s urging, John Ruan II acquired a substantial portion of Bankers Trust’s own stock, and took a seat on the board.
Mr. Ruan was a prominent and respected figure in Des Moines business circles due to the rapid growth of Ruan, his trucking business. The Ruan family acquired 44 percent of Banker’s Trust shares in 1964, making him the effective owner of the bank. He later used a reverse stock split to acquire the remaining shares.
The bank entered the Cedar Rapids market in 2002 as a de novo bank, with its own bank charter. Mr. Deignan acknowledged that some viewed it as an outsider entering the market, however, he’s found that everyone has their own definition of what “local” means, and that the backing of the Des Moines-based institution was a net positive.
“It allowed us to grow more quickly than almost any other bank could have done because we had the strength, resources, and a large, stable legacy company behind us,” Mr. Deignan said.
Ultimately, he said customers cared more about how well they were served, rather than whether Bankers Trust was owned by Cedar Rapids investors.
“To be local without horsepower, that doesn’t do much good,” he noted.
Bankers Trust set up shop in downtown Cedar Rapids with a visible location in the Town Centre building on Third Avenue SE in December 2002. It expanded to the second floor of that building in 2004, and opened a new branch at the high-traffic corner of C Avenue and Blairs Ferry Road NE in 2007.
With its continued growth, Bankers Trust moved a few blocks last year from the Town Centre building to the new CRST Tower on First Street SE. The bank took out long-term leases on both the ground-floor branch space and the 11th floor of the building, where employees have one of the best views in the city.
Mr. Deignan said the move provides more drive-up convenience for banking customers, and improved workspace for employees. Moreover, he said, the lease was a show of support for the investment made by CRST Chairman John Smith and his wife, Dyan, in constructing the first new downtown tower in Cedar Rapids in decades.
The bank’s centennial is being celebrated with more than just advertising reminders of its 100-year tradition. Bankers Trust held an event June 1 in Des Moines for key customers, and the following day hosted a big downtown block party, which included the unveiling of a large public art project.
Mr. Deignan said Bankers Trust will also host celebrations at each of its branches, and is donating $50,000 to NewBo City Market for an outdoor stage in what’s become one of the city’s most popular public spaces.
To show appreciation to its employees, the bank is giving each a $100 gift certificate and another $100 to donate to a nonprofit of their choice. The Boys and Girls Club, Horizons: A Family Service Alliance, Tanager Place, Theater Cedar Rapids and Four Oaks have been designated as beneficiaries.
The centennial comes as Bankers Trust begins its next leadership transition. Veteran CEO Suku Radia is preparing to retire in January 2018, and will turn over the position to President Don Coffin. The leaders have announced a goal to reach the $5 billion asset mark in 2020.
“Don’s a well-known commodity in our company,” Mr. Deignan said, calling consistent leadership a cornerstone of the trusted relationships the bank strives to build.
