A Conversation With ... Matt Bower

Poplar Bluff-based First Midwest Bank’s first full-service branch in Springfield opened in March after first launching in the market with a loan production office. Why did First Midwest Bank target the Springfield market?
I’ve been in Springfield for over 20 years. I’m the local guy that they hired to come on and help brand the bank and generate loans and deposits. Springfield has been on our radar for quite some time. My direct boss, Steve Millington, has some family here. He’s our regional market president. He is located in Springfield, as well, and also makes commercial loans. He likes Springfield. He’s familiar with Springfield and always felt like we would be able to come in and do well. Their primary banks are located around rural areas, with some in cities like Poplar Bluff and Cape Girardeau. [First Midwest Bank] felt like they would come here and be able to help the Springfield community. I align with that. My parents were small-business owners.

What are your plans for this market? Do you foresee further branches opening in southwest Missouri?
We’ve got a good presence in southeast Missouri. Springfield is the biggest market area of any of our banks. So, we see a lot of potential to continue to grow in Springfield and the surrounding areas. I certainly see significant growth. Obviously, that takes time coming into a new market, but certainly it’s on the radar to continue to grow with multiple branches and not only just in Springfield. I could certainly see us moving into the outside markets that could help with not only commercial, but rural as well.

Bank failures were a big concern in the market earlier this year with the closure of Silicon Valley Bank and others. Has that concern died down?
It’s not as relevant to our market as it was in those markets where those banks are failing. I don’t think that those banks were bad banks. I think that they were probably concentrated highly in areas where we’re not. Every bank needs to do a good job of keeping an eye on their underinsured deposits. We’re able to partner with a number of (banking services). There’s (Insured Cash Sweep) for deposits and then (Certificate of Deposit Account Registry Service) for CDs. We can take somebody, let’s just say an individual that wants to put $1 million in our bank, and if they don’t add any beneficiaries or do anything to increase their insured deposits, then they would only be insured for $250,000. What we can do through the ICS program is sign them up through that and instead of going from bank to bank to bank, well, we can go ahead and get it insured through this program where we share the deposits with other banks. They don’t have to go set up an account at the other bank. We reciprocate our deposits with these banks. In fact, Silicon Valley Bank was one of those banks on that list that participated in this program. Now, why they didn’t have more of their uninsured money in this program, I don’t know. But we did. We actually had a customer that had money and it was allocated to (Silicon Valley Bank), and it was business as usual after that bank failed. Those monies were fully insured; the customer never lost any interest on it. We have a good core base throughout the bank. Of course, Springfield’s growing, and we’re trying to raise capital. We’re able to insure those funds fully. I think that that’s an outlet that not a lot of banks are utilizing.

What’s the state of the banking workforce?
I was pretty fortunate from a standpoint of being able to hire our retail staff. I was able to bring on our operations manager, and then shortly after, we were able to hire three universal bankers to get us fully staffed for the branch from a retail standpoint. Being in Springfield, we certainly have a bigger market, more workforce. With all the colleges, we’ve got a good base to pull from, and so we were able to hire a credit analyst for the bank that is housed out of Springfield. From a hiring standpoint, those positions were easily defined. I am looking for a commercial lender. I’m also looking for a mortgage lender. But in the economy that we’re in right now, that’s tough. There’s so much uncertainty with the economy, with the market, with rising interest rates. I’m not just going to hire anybody. I want to hire the right person.

Is Springfield overbanked?
Springfield is very competitive. I don’t know that I’ve seen any markets around us, even Joplin, where we have to be so competitive from a rate standpoint. For our Springfield customers, they love it because banks compete daily to attract business, and certainly the margins are nowhere near what the margins are in other areas around Springfield.

Growing up, I saw my parents – they had their business, and they had their banker. If their banker left and went to another bank, they went to that bank and they followed. It was very much a relationship. I think that while customers are very sensitive about rates, it is about relationships. That’s how I’ve grown my business, and my customer base is making sure that I take care of them – hope that they would follow me. I’ve been very blessed because a majority of my customers have certainly wanted to follow me and been very supportive of the change.