Interview: Tim Schar, Tampa

Tim Schar Tampa Market President SunTrust (now Truist)

Ormond Beach, which ranked first and fifth worst, respectively.

Still, there are signs of improvement: for the first time since 2016, the nationwide mortgage fraud risk declined year-over-year between 2018 and 2019, partially due to interest rate reductions that caused a marked increase in the total number of low-risk refinance transactions. This dragged the percentage of risky applications down despite the absolute number of risky loans remaining more or less the same. In Q2 2018, 0.91% of applications contained an indicator of fraud, whereas 0.81% of applications indicated potential fraud in Q2 2019.

In other mortgage-related news, the Water Street Tampa development, Jeff Vinik’s $3 billion, 50-district overhaul of Downtown Tampa Bay being carried out in partnership with Bill Gates’ Cascade Investment LLC, received a considerable cash infusion thanks to

How does a large bank like SunTrust (now Truist) retain the personal touch of community banking?

We have a program called “T3: Touch, Technology and Trust,” featured in our new logo. There are some companies out there that are just technology companies and although they have great products, it can be impossible to get someone on the phone to provide support. We had to think about how to serve our communities, but this cannot be done with just touch alone. Consumers want to be able to solve problems through their technology, then they want to reach out to customer support and potentially go to the branch, with the branch employees able to track all their previous interactions with the bank. Part of the synergies of BB&T and SunTrust will be technology-based, and we are making significant investments in this area.

What services attract the most demand in the Tampa Bay area and why?

We see things dišerently than a traditional bank. The days of pushing a specific product are gone. Today, the most demand is for sound advice, especially given the huge access to information people have. Anyone can go on Google and find out almost anything, but what we can provide is tailored advice based on individual circumstances, resources and goals. Our advisorybased market strategy is founded in our industry expertise, understanding of our clients’ business and providing the best-in-class knowledge around financial strategy going forward.

What are some of your goals for the next year for Suntrust (Now Truist) in the Tampa Bay region?

Our initial goal is to help the market understand our capabilities. We now ošer a suite of services our customers haven’t really experienced before on a community level. We have more people focused in West Florida today than either BB&T or Suntrust had prior to the merger, and we are still considering expansion. There is still a lot of work to be done.

Bank OZK. The construction loan, which closed on Sept. 24, 2019, totaled $664 million. George Gleason, Bank OZK’s chairman and CEO, cited the individuals and companies behind the Water Street Tampa development as the major impetus for the bank extending what happens to be the largest single loan in its history.

Competitive landscape Competition in the banking sector is particularly heightened as credit unions are becoming increasingly competitive throughout Florida, and in the Tampa Bay-St. Petersburg area. Credit unions have been so successful about expanding their market share and competing with local community banks, in fact, that some industry insiders have begun to refer to credit unions as “the new community banks.” Much of this success is achieved through the acquisition of, or merger with, existing community banks by the credit unions. Some experts have predicted that the efficacy of this approach will, in the long-term, be its own undoing; simply put, credit unions are acquiring community banks so rapidly that some worry that soon there will be no community banks remaining to acquire. For many bankers, that cannot happen because of the role community banks play. “Community banking fulfills a need within the market it serves, especially with small to midsize companies. Tampa Bay is primarily a small-business market. These small businesses are our target market. Typically, we are not focused on large, public companies, although there are some fantastic public companies in the Tampa Bay market. If you have a small to midsize business that is in the higher end of that matrix in terms of revenue size and maturation, those business owners typically want a banker who can provide unique solutions. They want somebody who knows and understands their business and not simply an order taker,” said Gwynn Davey, Tampa Bay regional president of ServisFirst Bank.

In addition to credit unions, there have been numerous other high-profile mergers and acquisitions throughout the Tampa Bay region over the past year. The SunTrust-BB&T merger will no doubt have a substantial impact on the banking industry throughout the Southeast, including in Tampa. Seacoast Bank is also snapping up other banks in Tampa, with a total of three institutions acquired, two of which were bought within a span of 60 days. The most recent Seacoast acquisition was announced on Jan. 24, 2020, and involved a community bank called Freedom Bank, which was founded in 2005. At the

The Tampa Bay area hosts hundreds of business networking events each year.

time the acquisition was announced, Freedom Bank had two branches in St. Petersburg, total deposits of about $276 million, and loans of $249 million. The Freedom Bank acquisition is valued at approximately $63.6 million and will double Seacoast’s deposits in Tampa-St. Petersburg to roughly $679 million. Back in November 2019, Seacoast purchased First Bank of the Palm Beaches in West Palm Beach in a transaction valued at $32.9 million. Both deals were still pending board approval in early March.

Growth drivers Like many other sectors in Tampa Bay, the financial services industry remains on a strong growth footing. State-level advantages, such as Florida’s lack of a state income tax and other tax breaks, make it an attractive destination for banks and financial services firms, compared to historically dominant financial markets like New York City. Further accelerating the flight from Wall Street to Water Street was the comprehensive tax overhaul passed in 2017 by the Trump administration, known as the Tax Cuts and Jobs Act (TCJA). In particular, the TCJA changed how the State and Local Tax (SALT) deduction works, no longer allowing residents of states with high state