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Conservative growth at Woodhaven Bank

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FWB is republishing this 2011 story on Woodhaven National Bank, which on Sept. 24 announced it would be acquired by Pinnacle Bank. No numbers have been updated in the story, son any information is as of the date of publication, Jan. 11, 2011. 

The story of Woodhaven National Bank is not one of swashbuckling, aggressive business practices. It’s about a low-profile bank that has grown, survived and thrived for nearly 30 years by employing deliberate, conservative tactics and emerged – through some tough times – to tell about it.

“We never started the bank to grow it big and sell it, like a lot of folks did,” said Ron Casey, Woodhaven ’s chairman and CEO. “That was never our goal. Our goal was to have a conservatively run community bank, without a lot of risk, to take care of the community, take care of the employees and take care of the stockholders.”

After nearly three decades, that philosophy has proven effective. Woodhaven National Bank has grown from one small office and $38 million in assets to seven full-service offices with more than $400 million in assets and $350 million in deposits.

The bank was established in the summer of 1983 with an initial capital raise of less than $5 million by Mike Myers, chairman and CEO of Myers Bancshares Inc., the holding company of Woodhaven Bank and CEO of Myers Development Corp.

Myers recruited local bankers Frank Talley, Zach Gilliland, Arvil Lewis and Ron Casey to help start the bank, which has become the oldest and largest continually owned independent bank in Tarrant County.

Casey, now the bank’s chairman and CEO, says the bank was created to be a stable, reliable resource in the community, and that mission has never changed.

Tough way to start

Still, the 1980s were a turbulent time to start a bank in Texas. The savings and loan crisis wrecked the state’s economy and several well-established, long-standing financial institutions failed along with a number of smaller banks.

Woodhaven felt the impact, too, and was forced to shrink at a time when most new banks at its stage of development are aggressively trying to grow.

“We reduced our asset size to maintain our capital and stayed conservatively oriented and just took care of business,” Casey said. “And we got though that mess without a problem.”

The market turned around in the 1990s, and after more than a decade of operating from a small leased space on Woodhaven Avenue in Fort Worth, the bank built and moved into a new, free-standing headquarters on Bridge Street in 1995.

After establishing its roots in East Fort Worth, the bank began a 10-year process of conservative growth and expansion into the communities of Mansfield, West Fort Worth, North Fort Worth, Hurst, Arlington and Rhome.

Woodhaven made the moves deliberately, taking advantage of a rich talent pool that was being displaced during a storm of M & A activity that was washing over the industry in the late 1990s and early 2000s.

“When all the mergers were happening and everybody was buying out everybody, a lot of good bankers became available,” Casey said. “We saw the opportunity to bring those displaced bankers on board. Many were bank presidents, so we went to them and said we would open a bank in their community and made it attractive to them.”

“The public doesn’t know us all that well – we advertise some but not a lot – but we do have a strong reputation within the banking community,” he said. “Those bankers understood that we had a good organization so they came to work for us.”

When a Woodhaven is not a Woodhaven

The expansion strategy also developed its own unusual dynamic – not all Woodhaven banks are called Woodhaven banks. Of the seven branches claimed by Woodhaven National Bank, only four actually go by that name. Branches in the Ridglea area, Mansfield and Arlington have their own identities, sans Woodhaven .

“Every area we opened in had its own culture and we felt like it was appropriate to stay true to the culture of the community we move to,” Casey said. “There are some disadvantages to that, and we have thought of changing the names from time to time, but every time you do that people think you’ve sold the bank, so we’ve always just left it alone.

“It wasn’t a long-range plan,” he said. “It just sort of developed that way.”

“Our growth has really come from putting in branches and bringing in people in these communities that actually we were bankers there before,” said Sharon Burran, president and chief operating officer for Woodhaven . “They had a following, and they brought that following with them.”

Woodhaven ’s characteristic conservative lending and business strategy has also served it well during the most recent economic downturn. Since 2008 the bank has grown deposits and assets by about $50 million while other banks in the Metroplex have struggled.

Burran said the growth may have as much to do with people leaving the stock market for a safer haven as with anything Woodhaven has done.

“With FDIC insurance going up to $250,000, along with other avenues to keep people’s money insured, we can insure deposits up to 100 percent and people love that,” she said.

Weathering the storm

When the commercial real estate markets began to crumble in 2008, the bank was already relatively well-positioned, Casey said. Woodhaven had stayed away from development loans and had concentrated mostly on owner-occupied commercial lending and SBA loans.

“Part of our culture has been to serve small business and professional/executive lending, so our loans weren’t typically speculative or risky in nature,” he said.

Woodhaven did get involved with some residential construction, but saw the market turning south early and was able to extricate itself relatively quickly and reduce its exposure. Over two years, Woodhaven cut its real estate loan portfolio by about two-thirds.

“We had a few problems but nothing like the massive problems that other banks had,” Burran said. “We were able to take action early so we didn’t get hit when many other banks did.”

Casey gave regulators credit for helping his bank realize that the market was in trouble.

“They gave us some forewarnings,” he said. “They had been to a lot of other banks and gave us some good advice. We were able to see the market turning down ourselves, so we were able to avoid a lot of trouble and just got through it. But the regulators are our friends.”

Going forward, Casey said, the bank would consider opportunities to expand via acquisition, but only if the opportunity is a good one that fits with Woodhaven ’s conservative philosophy.

“While we’re not out there actively trying to grow the bank from $400 million to $600 million, if an opportunity comes along that is a good one, we’ll do it,” he said. “We have the resources; it just has to make sense.”

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