Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, January 20, 1993 TAG: 9301200070
SECTION: BUSINESS PAGE: B5 EDITION: METRO
SOURCE: MAG POFF STAFF WRITER
DATELINE: LENGTH: Medium
HERE FOR THE LONG HAUL
Central Fidelity Banks thinks Virginians may be worried about their banks disappearing. Its chairman is here to say that won't happen to Central Fidelity.\ The chairman of Central Fidelity Banks Inc. came to town Tuesday with two messages for 400 local civic and business leaders.
Banks want to lend money to commercial customers, Carroll L. Saine told a breakfast gathering at Holiday Inn-Tanglewood.
And Central Fidelity, he said, is the Virginia bank with no interest in expanding elsewhere.
About half of the people at the meeting were customers of Central Fidelity. The rest, Saine said, were prospective customers.
Commercial customers, he said, want long-term relationships, so they are concerned about the number of Virginia banks that may disappear.
He said he told them Central Fidelity plans to be "a long-term partner."
In an interview after the meeting, Saine said he was on a swing throughout the state to thank customers and look for new ones.
He'd already been to Northern Virginia and Tidewater, plans to visit Lynchburg on Thursday and is to speak in Richmond next week.
His purpose, Saine explained, was to counter the impression that banks don't want to lend. Banks are eager to lend and they have the money to lend, he said. The recession and slow, weak recovery mean companies have had small demands to borrow money.
Central Fidelity has no interest in merging with a larger institution or stepping outside Virginia. But Saine agreed with analysts who say the country has too many banks.
He sees a future with "a handful" of 20 to 25 super-regional banks such as NationsBank and First Union of Charlotte, which will acquire Dominion at the end of this quarter.
Community banks will survive as well, he said.
But Saine foresees a solid and profitable niche for Central Fidelity, of a size to serve a statewide market yet small enough to provide localize services.
"Banking is a personal, local market business," Saine said.
He said Virginia is probably on the same course as Florida, which a decade ago had about 10 large or mid-size statewide banks. Today Barnett Bank is the only one left.
Virginia may see more mergers this year and an escalation of the trend in 1994, Saine said. He expects President-elect Clinton to foster mergers with a new banking bill.
Saine said Central Fidelity escaped the serious problems of several competitors who were burned in the collapse of the real estate market in metropolitan Washington.
While others mined the Northern Virginia market, he said, Central Fidelity saw opportunity in the Roanoke Valley and Western Virginia. "We said if no one else is interested, we are."
Starting six years ago, Central Fidelity added 13 branches in the western part of the state and $3 million to its local payroll.
It had deposits in this region of Growth in the Roanoke Valley, Saine said, "has a steady upward path . . . That's sort of the pace we like." $200 million then, he said, with a goal of $500 million by 1995. Last year, Saine said, Roanoke-area deposits reached $600 million.
The collapse of the Washington metro market, he said, proves the attractiveness of more stable markets such as the Roanoke Valley. Growth here is slow, he conceded, "but it has a steady upward path . . . That's sort of the pace we like."
At the same time, he said, Central Fidelity has continued to grow. It had assets of $5 billion in 1989 compared to $8.7 billion today.
Central Fidelity is the third-largest bank in-state, he said, counting Virginia operations of Charlotte, N.C.-based NationsBank as first and Crestar Bank of Richmond as second.
Central Fidelity is slightly bigger than Dominion Bankhares of Roanoke and Signet Banking of Richmond, if assets by those companies in other states are ruled out.