Ex-CEO of Southern Bancorp Rebuts Alleged Backdrop to his 'Retirement'

by George Waldon  on Monday, Apr. 2, 2012 12:00 am  

Phil Baldwin, former CEO and president of Southern Bancorp Inc.

Southern Bancorp Inc. of Arkadelphia issued a statement that included elaboration on the January 2011 "retirement" of CEO Phil Baldwin - a statement that Baldwin disputes.

The dueling narratives were prompted by Arkansas Business' recent coverage of personnel changes at the hybrid bank and charitable nonprofit, which has been headed by its longtime chairman Walter Smiley since Baldwin's departure.

Baldwin, hired as chief financial officer in 2000 and promoted to president and CEO in 2002, directed the growth of Southern Bancorp into America's largest rural development bank.

Profits from the $1.1 billion-asset banking operations combined with grants from charitable foundations helped support the venture's nonprofit endeavors in Arkansas and Mississippi.

"In the months prior to Phil's departure," the statement by Southern Bancorp said, "our board started to notice a shift away from its vision and implementation of Southern's core mission and values. While the banking operation grew substantially, our nonprofit activities continued to shrink. Phil's alternate vision for Southern was clearly driving this trend - focusing on the bank and reducing the role of the nonprofit.

"Over time, this created a disconnect between Phil and the board, eventually leading to Phil's decision to retire. An example of this disconnect was Phil's desire to make Southern a publicly traded bank and the board's consistent position that such move would substantially diminish Southern's mission."

Baldwin was surprised to learn of Southern Bancorp's statement and described it as highly inaccurate. He estimated that his work was divided 60-40 between nonprofit and banking business and offered this statement in response:

"The community development work of Southern Bancorp was always my most significant priority.

"In spite of the national economic challenges from 2008-2010, the social mission of Southern expanded through the creation of a new strategic relationship with the W.K. Kellogg Foundation; an expanded partnership with the Walton Family Foundation into Coahoma County, Mississippi; funding that allowed the King Biscuit Blues Festival to continue in Helena, the development of a cultural tourism program in Helena as well as building of a new downtown Helena public library, the Great Rivers Promise program in Phillips County that helps children in Phillips County attend community college; the Arkadelphia Promise that allows graduates of Arkadelphia High School to attend any college or university in Arkansas and the renovation of the old Federal Reserve Bank building in Little Rock for the benefit of the [eStem] charter school."

In 2010, Baldwin and Southern were named one of the top five social entrepreneurs in America by Bloomberg Businessweek magazine. Baldwin is currently serving as national board chair of United Way of America, the largest nonprofit organization in the world.

Personnel Changes

Smiley was named interim president and CEO of the holding company after Baldwin left. The "interim" was later dropped, and the 74-year-old executive continues to direct Southern Bancorp.

John Olaimey was hired earlier this year as president and CEO of Southern Bancorp Bank. Olaimey spent four years in banking as executive vice president and chief operating officer at Little Rock's Centennial Bank, which was acquired by Home BancShares Inc. of Conway in 2008.

He replaced Scott Fife, Baldwin's hand-picked successor to lead the bank, who returned to oversee Southern Bancorp's El Dorado operations.

Robert Cern, 61, was hired in December to fill the CFO post left vacant for seven months after Brent Black, 36, left to join Summit Bank of Arkadelphia, four months after Baldwin's exit.



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