Centennial Bank Looks to Bag More FDIC Transactions This Year

by George Waldon  on Monday, May. 3, 2010 12:00 am  

Randy Sims, CEO of Home BancShares and its Centennial Bank: "We're still on the hunt."

Top executives at Home BancShares Inc. recognized a rare opportunity was headed their way when the government last year announced its intention to facilitate the sale of failed financial institutions around the nation.

The Conway bankers were determined to be a player in the bidding process that landed two south Florida banks in March. The fiscal effect of the federally assisted acquisitions of Old Southern Bank of Orlando and Key West Bank was stunning.

Total assets topped $3 billion, net income soared to $15.1 million, and earnings per share doubled to 56 cents for the quarter ending March 31. The first-quarter results were equivalent to the company's fifth-best year.

"When you have this happening, these transactions become more interesting," said Randy Sims, CEO of Home BancShares and its Centennial Bank. "The downside is the transactions are becoming much more competitive. We still have lots of capital. We're still on the hunt. If it makes sense, we'll go after it."

Sims credits Johnny Allison, chairman of Home Bancshares, with leading the charge to expand the Centennial Bank franchise during these unusual times.

Allison, who passed the mantle of CEO to Sims last year, is thriving in the deal-making environment that has seen the Federal Deposit Insurance Corp. assist in the almost weekly sale of insolvent banks since Jan. 8. The roster of bank failures in 2010 stands at 57 and climbing.

"This is really fun for me," said Allison, who was tooling around somewhere in Florida last week. "This is my game. I don't run the banks. The bankers run the bank. I never ran the bank anyway.

"My job is the big-picture look, raising capital, finding new deals and putting the deals together. It's challenging and interesting, and I'm meeting a lot of good people."

Allison couldn't say where in Florida he was exactly, a nod to a confidentiality agreement with the FDIC. Under the agency's rules of engagement, it's OK to talk about done deals, but it's not OK to talk about unsuccessful bids or possible deals.

Judging by the background noise of the GPS system of his vehicle, Allison was in the field scouting locations of a would-be acquisition target. It's no secret that troubled Florida banks are a priority target for Centennial Bank, which already had a Florida presence.

"This is a generational opportunity to jump out there and find some things that makes our franchise more valuable," Sims said back in the home office in Conway. "Hopefully, there will be more Florida opportunities to jump into."

Ready for Action

Home BancShares began gearing up in August for the FDIC selloff. That activity produced a $107 million stock offering to build a war chest for recapitalizing insolvent acquisitions.



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