Regions Bank targets commercial market

It’s not the loans’ $2 million value that’s of importance to bank officials; it’s the client.

Regions Bank is targeting municipalities and businesses in a developing initiative.

“We’ve certainly planted a lot of seeds this year with municipalities, and I think our transactions will pick up in 2006 and going forward,” said Mick Nitsch, Regions Bank community president. “We really didn’t do a lot of (municipal business) in the past because we didn’t have the products to offer that we have today.”

Those new products are in part a result of the bank’s association with partner companies Morgan, Keegan & Co. and Rebsamen Insurance Inc.

“Morgan Keegan was a leading provider of long-term municipal bonds in the south central (United States) for the last couple of years,” Nitsch said. “With our combined resources, our product array that we offer to cities has expanded, and we have more depth in dealing with cities like Ozark.”

Nitsch said about 60 percent of the bank’s business in southwest Missouri is in the retail sector. He added that there aren’t any specific quotas or goals in place for the bank’s municipal programs, noting that the bank is just hoping to “be invited to discuss municipal opportunities wherever they come up.”

Ozark Mayor Donna McQuay said that the three projects – sewer improvements in two neighborhood improvement districts and improvements to the city’s downtown district – will help Ozark deal with a population jump that caught the city by surprise.

“We got hit with the boom overnight. We’re still trying to catch up,” McQuay said.

The neighborhood improvement districts are authorized by the state constitution to allow for taxation to pay for improvements within the area. The downtown project will receive a $300,000 loan from Regions, to be paid back over four years, while the two NID projects will be paid for with bonds to be issued in the next six months.

“(The district) helps the city expand – it helps (the lenders) I’m sure, but it does help the city put infrastructure in,” McQuay added. “It’s a good tool if it’s used properly.”

Devin Bobbett, commercial relationship manager for Regions, is in charge of the Ozark financing projects. He said the use of traditional loans by cities is less common than the use of municipal bonds, which are tax-exempt.

“A buyer of a tax-exempt bond is getting a better return than they would on a bond that’s taxable,” he said. “A general company is not eligible to do tax-exempt financing like that, so that’s an advantage that municipalities have, and they (use) it.”

McQuay added that Regions was chosen through a standard bid process. Ozark has worked with Regions’ predecessor Union Planters Bank in the past.

“They had the lowest bid, and everything checked out,” she said. “They have managed to do the best job of sharpening the pencil. They’ve been very good to deal with, and we’ve enjoyed our relationship with them.”