CertusBank

CertusBank was an American nationally chartered bank headquartered in Greenville, South Carolina, with additional corporate offices in Atlanta, Georgia, and Charlotte, North Carolina. The institution operated as a subsidiary of CertusHoldings, Inc., a holding company formerly known as Blue Ridge Holdings, Inc. Its founders included Angela Webb, Walter Davis, Milton Jones Jr., and Charles Williams, former executives associated with Bank of America and Wachovia. The bank was established during the post-2008 financial crisis period, when the failure of community and regional banks created opportunities for new institutions to acquire deposits, branches, and selected assets through transactions arranged with the Federal Deposit Insurance Corporation. In 2010, CertusHoldings received a shelf charter from the Office of the Comptroller of the Currency and raised $500 million from investors. CertusBank began operating in January 2011 after acquiring the failed CommunitySouth Bank & Trust of Easley, South Carolina. Six former CommunitySouth branches reopened under the CertusBank name the following day, and Easley became the institution's initial headquarters city. CertusBank pursued a rapid acquisition-led expansion. In May 2011 it acquired the operations of Atlantic Southern Bank of Macon, Georgia, and First Georgia Banking Company of Franklin, Georgia, both of which had failed and were resolved by the FDIC. These transactions added dozens of locations and expanded the bank's presence across Georgia and the Carolinas. The bank subsequently added brokerage, mortgage, small-business finance, and wealth-management capabilities through acquisitions and strategic investments. Its transactions included Sage Southeastern Securities, Myers Park Mortgage, Quadrant Financial, Hometown Community Bank, Resource Financial Services, and Parkway Bank. At its peak, CertusBank had more than 30 retail branches in the Carolinas, Florida, and Georgia and reported a presence in twelve states. Its business lines included retail banking, consumer lending, wholesale banking, mortgage lending, wealth management, brokerage services, and Small Business Administration lending. The Quadrant Financial acquisition supported the creation of CertusBank Small Business Finance and helped make the institution the largest SBA 7(a) lender based in South Carolina at that time, according to the reference material. The bank also sought to build a broader wealth-management platform. In 2013 it announced an intended strategic investment in Monarch Business and Wealth Management, a joint venture serving professional athletes, international entertainers, and high-net-worth families. CertusBank supported community organizations in the Greenville area and elsewhere, including the Peace Center for the Performing Arts, Habitat for Humanity, the Greenville County Museum of Art, the Northside Development Corporation, and the South Carolina Governor's School for Science and Mathematics. CertusBank's expansion was not sustained. In 2014 John S. Poelker became interim president and chief executive officer, while Robert L. Wright became chairman. Poelker later resigned as chairman, president, and chief executive officer in May 2015 because of health concerns, and Len Davenport, the bank's chief information officer and treasurer, became interim chief executive. During 2015 the institution faced mounting losses, investor disputes, and allegations concerning excessive executive spending. The bank elected to enter liquidation. Hedge-fund investors sued, while ousted founders filed a counter-suit alleging defamation. The Office of the Comptroller of the Currency also imposed fines related to excessive spending, although the supplied reference does not specify the amounts or exact orders. Creditors ultimately accepted a settlement reported as approximately seven cents on the dollar in 2017. CertusBank therefore represents a post-crisis bank formed around FDIC-assisted acquisitions whose aggressive expansion ended in liquidation and creditor settlement.

CertusBank emerged from the restructuring of the American banking sector after the global financial crisis. Its holding company, initially known as Blue Ridge Holdings, Inc. and later renamed CertusHoldings, Inc., received a shelf charter from the Office of the Comptroller of the Currency in 2010 and raised $500 million from investors. The institution was founded by Angela Webb, Walter Davis, Milton Jones Jr., and Charles Williams, who had backgrounds as executives at Bank of America and Wachovia. The bank commenced operations on January 21, 2011, when it acquired the failed CommunitySouth Bank & Trust of Easley, South Carolina. The FDIC-assisted transaction enabled CertusBank to acquire the bank's deposits and selected assets, while the FDIC agreed to cover a portion of problem loans. CommunitySouth's six branches reopened as CertusBank locations the next day. Easley initially served as the bank's headquarters, although the institution later maintained principal corporate offices in Greenville as well as secondary offices in Atlanta and Charlotte. CertusBank quickly adopted an acquisition-led growth model. In May 2011 it acquired the operations of Atlantic Southern Bank of Macon and First Georgia Banking Company of Franklin after both Georgia banks failed. The transactions added a substantial deposit and branch base and extended CertusBank's reach across Georgia and the Carolinas. In October of the same year, the bank purchased Sage Southeastern Securities, adding brokerage capabilities to its wealth-management business. Expansion continued in 2012 and 2013. CertusBank acquired Myers Park Mortgage of Charlotte on August 3, 2012, followed shortly afterward by Quadrant Financial. The latter transaction supported a new CertusBank Small Business Finance division and strengthened the bank's SBA 7(a) lending activities. In November 2012, CertusBank acquired assets and deposits of Hometown Community Bank after its closure by Georgia regulators. It completed the acquisition of Resource Financial Services, an independent mortgage company based in Columbia, South Carolina, in December 2012. On April 26, 2013, CertusBank acquired assets and deposits from Parkway Bank of Lenoir after that North Carolina bank was closed by state regulators. The institution's business scope included retail deposits and banking, consumer and wholesale lending, mortgage finance, wealth management, brokerage, and small-business finance. At its peak it operated more than 30 retail branches in the Carolinas, Florida, and Georgia and had a presence in twelve states. CertusBank also announced an intended strategic investment in Monarch Business and Wealth Management in 2013. That venture served professional athletes, international entertainers, and high-net-worth families, reflecting the bank's attempt to develop specialized advisory and wealth-management services beyond conventional branch banking. Management changed during the final phase of the bank's existence. On April 9, 2014, John S. Poelker was named interim president and chief executive officer, while Robert L. Wright became chairman of the board. In May 2015, Poelker resigned as chairman, president, and chief executive officer, citing health concerns. Len Davenport, who had been CertusBank's chief information officer and treasurer, became interim CEO. By 2015 the bank was experiencing mounting losses and faced allegations of lavish executive spending. CertusBank elected to liquidate rather than continue operating. Hedge-fund investors brought litigation, and ousted founders filed a counterclaim alleging defamation. The Office of the Comptroller of the Currency imposed fines concerning excessive spending, though the available reference does not provide the amount or detailed terms. The liquidation generated further creditor disputes, which concluded when creditors accepted a settlement reported at approximately seven cents for each dollar of claims in 2017. CertusBank is consequently remembered as a post-crisis regional bank whose rapid FDIC-assisted expansion into a diversified financial-services platform ended in liquidation.

• 2017

  Creditor settlement accepted

  [1]CertusBanken.wikipedia.org

  Creditors accepted a settlement reported at approximately seven cents on the dollar.

• 2015

  Liquidation elected

  [1]CertusBanken.wikipedia.org

  The bank elected to enter liquidation amid losses, executive-spending allegations, and investor disputes.

• 2013

  Parkway Bank assets and deposits acquired

  [1]CertusBanken.wikipedia.org

  CertusBank acquired selected assets and deposits from Parkway Bank after its closure by North Carolina regulators.

• 2013

  Monarch investment announced

  [1]CertusBanken.wikipedia.org

  CertusBank announced an intended strategic investment in Monarch Business and Wealth Management.

• 2012

  Mortgage and small-business expansion

  [1]CertusBanken.wikipedia.org

  CertusBank acquired Myers Park Mortgage and Quadrant Financial, creating or strengthening dedicated mortgage and SBA finance capabilities.

• 2012

  Hometown Community Bank assets acquired

  [1]CertusBanken.wikipedia.org

  CertusBank assumed deposits and selected liabilities and acquired related assets of the failed Georgia bank.

• 2012

  Resource Financial Services acquisition completed

  [1]CertusBanken.wikipedia.org

  The bank completed its purchase of the Columbia, South Carolina-based independent mortgage company.

• 2011

  CertusBank begins operations

  [1]CertusBanken.wikipedia.org

  The new bank acquired CommunitySouth Bank & Trust of Easley, South Carolina, through an FDIC-assisted transaction and reopened its six branches.

• 2011

  Expansion into Georgia

  [1]CertusBanken.wikipedia.org

  CertusBank acquired the operations of failed Atlantic Southern Bank and First Georgia Banking Company.

• 2011

  Brokerage capabilities added

  [1]CertusBanken.wikipedia.org

  The acquisition of Sage Southeastern Securities broadened the bank's wealth-management offering.

• 2010

  CertusHoldings receives a national banking shelf charter

  [1]CertusBanken.wikipedia.org

  CertusHoldings received a shelf charter from the Office of the Comptroller of the Currency and raised $500 million from investors.

A growth-oriented southeastern regional bank built through FDIC-assisted acquisitions and expansion into mortgage, wealth-management, brokerage, and small-business finance services.

• Banking · 2011

  Retail banking

  CertusBank operated a branch-based retail banking business offering deposit and general banking services. Its retail network grew through FDIC-assisted acquisitions and reached more than 30 branches at its peak, particularly across the Carolinas, Georgia, and Florida.

• Lending

  Consumer lending

  Consumer lending was one of CertusBank's stated core business lines. The available sources identify the category but do not provide a detailed catalog of individual loan products or terms.

• Banking

  Wholesale banking

  The bank provided wholesale banking services as part of its broader commercial and institutional offering. Specific products and customer segments are not detailed in the supplied reference.

• Mortgage finance · 2012

  Mortgage lending

  CertusBank expanded mortgage finance through Myers Park Mortgage and Resource Financial Services. These acquisitions gave the institution additional origination and mortgage-company capabilities alongside its banking operations.

• Wealth management · 2011

  Wealth management and brokerage

  The acquisition of Sage Southeastern Securities added brokerage capabilities to CertusBank's wealth-management offering. The bank later pursued a strategic investment in Monarch Business and Wealth Management, targeting specialized clients such as athletes, entertainers, and wealthy families.

• Small-business finance · 2012

  CertusBank Small Business Finance

  Created following the Quadrant Financial acquisition, this division focused on small-business finance and SBA 7(a) lending. The transaction was described as making CertusBank the largest SBA 7(a) lender based in South Carolina at the time.

• 2015

  Executive-spending allegations and liquidation

  During the bank's final year, CertusBank faced allegations of lavish executive spending while suffering mounting losses. The OCC imposed fines related to excessive spending, and the bank elected to liquidate. Investor litigation and a countersuit by ousted founders followed.

  Source

Read more

• 2015

  Elect to liquidateOther

  Background

  Mounting losses, allegations concerning executive spending, regulatory penalties, and investor disputes undermined the bank's continued operation.

  Action taken

  CertusBank elected to enter liquidation.

  Aftermath

  Investors and founders pursued litigation, and creditors later accepted a settlement reported at approximately seven cents on the dollar.

  Creditor settlement recovery. Approximately $0.07 per dollar of claims (2017)

  Source

• 2013

  Invest in specialized wealth managementStrategy

  Background

  CertusBank aimed to broaden its wealth-management platform and reach specialized affluent clients.

  Action taken

  It announced an intention to make a strategic investment in Monarch Business and Wealth Management.

  Aftermath

  The available source does not state the final terms or long-term outcome of the proposed investment.

  Source

• 2012

  Build a dedicated small-business finance divisionStrategy

  Background

  CertusBank sought to diversify beyond branch banking through specialty lending.

  Action taken

  After acquiring Quadrant Financial, it created CertusBank Small Business Finance and expanded its SBA 7(a) activity.

  Aftermath

  The transaction strengthened CertusBank's position in SBA lending in South Carolina.

  Source

• 2011

  Acquire CommunitySouth Bank & TrustM&A

  Background

  CertusBank used an FDIC-assisted transaction to establish its operating branch network after CommunitySouth failed.

  Action taken

  It acquired selected assets and deposits, and reopened six branches under the CertusBank name.

  Aftermath

  The transaction launched CertusBank's retail presence and made Easley its initial headquarters city.

  CommunitySouth deposits and assets at September 30, 2010. $402.4 million in deposits and $440.6 million in assets (September 30, 2010)

  Source

• 2011

  Acquire Atlantic Southern Bank and First Georgia Banking Company operationsM&A

  Background

  The two Georgia banks failed and were resolved through FDIC-arranged transactions.

  Action taken

  CertusBank acquired their operations, including deposits and selected assets.

  Aftermath

  The acquisitions added substantial scale and extended the bank's southeastern branch footprint.

  Acquired institutions' reported assets and deposits. Atlantic Southern Bank had $741.9 million in assets and $707.6 million in deposits; the two transactions had a combined value exceeding $1 billion. (2011)

  Source

1. 1CertusBanken.wikipedia.org