A Conversation With ... Jeff Williams

Carthage-based Four States Bank opened this fall after receiving the first new bank charter approved in the state in nearly 16 years. Talk about the significance of that.
Just since the economic crisis back in 2008, no matter where you’re at in the country, the banking system has become harder to charter a bank. The extra focus on capital and management and history and experience has made it a little bit tougher to get a bank approval than prior to that. The combination of our management experience, the strength of our board of directors and the capital amount that we were able to raise, I think, was why our approval process went fairly quickly. We raised in excess of $25 million.

What does that capital raise allow you to do?
That’s basically our nest egg, if you will. The capital we’re starting with is what we’ve got to build the foundation of the bank with. We were very fortunate that we were able to put together the capital fairly quickly. A big part of that was based on the team we built. That gives us the ability to weather the storm and cover some startup costs. Our overall startup costs came out a little bit lower than what we budgeted. We’ve really worked hard to make sure we’ve been very frugal as we’ve gone through this process.

What does the process for obtaining a bank charter look like?
It took us a little under a year. We actually filed our bank application right before Thanksgiving last year. Within a couple of weeks, they sent us back a response, and they asked for a little bit more information. That was in early December. It took us a little bit of time to compile that information. We resubmitted our final information to them in early January, and then we received our approval, I believe the date was June 11 that we received our formal approval. The whole process from the time we submitted the application was about eight months before we got our approved charter and then it took another ... three months to open after that.

What’s the ideology behind Four States Bank? Why was the bank started?
We want to be an alternative to customers in the markets that we serve – primarily focusing on small- to medium-sized businesses, farmers and then home loans. We have a lot of expertise in the (Small Business Administration) field. A lot of banks do a good job with SBA lending, but not everybody’s interested in SBA lending. We’ve got a lot of connections that are, that can send those kinds of deals to us. We do a lot of SBA loans. We do a lot of farm loans. We’re going to participate in the (U.S. Department of Agriculture) rural and farm programs, as well.

There are some big names behind Four States Bank, including yourself and veteran banker Gary E. Metzger as chair. How did this bringing together of banking vets happen, and what’s the significance of the combined experience?
I worked for Liberty Bank from 2006 to 2016, after they sold to Simmons [Bank]. That’s how I got to know Gary Metzger and Garry Robinson from our board. I left there and went to Guaranty Bank at that point in time. I’d known [4SB Chief Financial Officer, Chief Operating Officer and board director] Carter Peters even before that. Carter had been the CFO of Guaranty Bank. Really, this all kind of came together just from a culmination of careers in banking. Between Carter Peters and I, we’ve both been in banking in that region for about 30 years and had lots of relationships. I was very fortunate that Mr. Metzger, with his experience and reputation, was interested in being involved. The rest of the directors were assembled over time from various connections. The majority of our directors had a lot of banking experience in the past.

What are the biggest opportunities for 4SB as you launch?
Given the fact that the initial employees have got long careers in banking in the region, we’re off to a reasonably good start just based on relationships and taking care of relationships that we’ve historically had in the past. To be a very small bank with a very rapid decision-making process that offers the technological access to the digital platforms and the technology you’d expect from a larger bank, we feel like that’s going to give us a great opportunity.

What about challenges?
I think the biggest challenge any bank would tell you they’re facing today is gathering deposits and the cost that you have to pay for those deposits in comparison to the interest rate you can get on a loan. That’s why we’re so focused on controlling our overhead and keeping our fixed assets relatively low. It’s because we want to be able to pay a fair rate on deposits and charge a fair rate on loans and still be able to make a little bit of profit.