The Trust Company of the Ozarks, starting with capital of $1.93 million and including 21 investors that are banks or bank holding companies, is set to open its doors in the middle of March.
The company will join Springfield Trust Company as Springfield's second stand-alone trust business.
Jay Burchfield will be the new company's chairman. Dwight Rahmeyer is the company's chief executive officer and Rodger Gadd is its president. This is not the first time Rahmeyer and Gadd will have Burchfield as a boss. He was previously chairman and CEO of Boatmen's Bank of Southern Missouri when the two were trust officers for the bank in Springfield.
The new trust company is another ripple in Springfield's financial services market pond. The stone that was cast to start it all came with the August 1996 announcement that NationsBank would merge with Boatmen's.
"It's just a continuation of that story," said Joe Turner, president of Great Southern Bancorp Inc. and a director of Trust Company of the Ozarks.
This round of ripples besides Burchfield, Rahmeyer and Gadd's previous connection to Boatmen's are a result of NationsBank's withdrawal from the benefit management portion of the trust business and changing its personal trust service after the merger.
Those actions were "not the defining reason, but it was the catalyst for us," Rahmeyer said. "This is not an anti-NationsBank decision but a pro-Ozarks decision."
Large holding-company banks target high-net-worth customers, with multimillion-dollar portfolios, Rahmeyer said.
"There's a lot of folks in the Ozarks, who, by any normal standards, are very wealthy," Burchfield said.
Rahmeyer and Gadd "ran the highest performing trust department in Boatmen's," Burchfield said. "Our margins were the best in the company. We had the smallest investable assets per account, yet we outperformed" departments based in St. Louis and elsewhere.
Grady Sanford has joined the new company as private investment adviser after 18 years with Merrill Lynch. In all, the firm will begin with seven employees.
In its Jan. 26 charter application, Trust Company of the Ozarks listed, along with 19 individual investors, 21 banks and bank holding companies as investors in the company. Those banks will serve as a referral network for the new firm.
The bank and holding company investors are: Stone County National Bank, based in Crane; First State Bank of Purdy, Monett; Southwest Community Bank, Ozark; Central Bank, Lebanon; First Independent Bank, Aurora; Farmers State Bank, Bolivar; Wood & Huston Bank, Marshall; Sac River Valley Bank, Stockton; Liberty Bank, Springfield; First National Bank, Camdenton; The Greene County Bank, Strafford; Century Bancshares Inc., Gainesville; Community Bancshares of West Plains Inc., West Plains; Bancshares of Urbana, Urbana; West Plains Bancshares Inc., West Plains; Lamar Trust Bancshares Inc., Lamar; First Bancshares Inc., Mountain Grove; Mid-Missouri Bancshares Inc., Nevada; Peoples Banking Company, Springfield; City Bancorp, Springfield; Great Southern Bancorp Inc., Springfield
"Most business for a trust company comes from referrals; from a variety of places, but primarily they come from bankers," Rahmeyer said. "The business we booked (at Boatmen's) came from Boatmen's Banks in southern Missouri. (Trust departments) look at their branch network as their primary source of business. It will be the same with us."
Burchfield said the investors and other banks that will refer business to the trust company represent an even larger group than the former Boatmen's. He said together the 80 locations of the banks have total assets of $2.8 billion.
Beyond its advantages to the new trust company, the relationship is advantageous to the banks, as well.
"Their primary motivating factor is to be good bankers," Rahmeyer said. Burchfield said, secondarily, the banks are also looking for a return on their investment.
"The advantage is having a place to refer customers," Great Southern's Turner said. Great Southern, he said, is a bit different from the other bank investors in that it does not have specific trust services, but it does have an investment services department, Turner said.
Rahmeyer said banks often hesitate to refer customers to other banks' trust departments for fear of losing other banking business, too.
The company's board of directors reflects a balance of Springfield, outlying area bank investors, and individual investors. The 10-member board, in addition to Burchfield, Turner, Gadd and Rahmeyer, includes Lee Gilbert, John L. Harlin, Noel Boyd, Mary Beth O'Reilly, Gary E. Metzger, and David D. Cribbs.
Debra Hardman, senior bank examiner with Missouri's Division of Finance, said the trust company's application was still in its review stage, and she could not say when it will be approved. Rahmeyer said he hopes for approval in mid-March, around the same time offices at 3828 S. Fremont are ready to be occupied.
In its application, Trust Company of the Ozarks projected it would manage accounts worth $36.55 million after its first year. In its third year, projections are the company will will show positive net income after taxes and manage $89.55 million in accounts.
"We think those are realistic, moderate projections," Rahmeyer said.[[In-content Ad]]
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