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Charleston Business

Beacon Strives To Be More Than Just Another Bank

May 10, 2018 08:18AM ● By Makayla Gay

By Brian Sherman

   Locally-owned community banks in the Lowcountry and elsewhere have become somewhat of an endangered species in recent years. Many of them have been gobbled up by large banks that continue to expand their ever-growing reach. However, a group of local businessmen are bucking the trend.

President and CEO Brooks Melton believes Beacon Community Bank is anything but ordinary. Instead, it’s a place where small business owners, small real estate investors, and individuals can be better served than they are by massive financial institutions.

“We are not just another bank,” said Melton. “The whole board lives in the Charleston area. Our management team lives in the Charleston area. 100 percent of our decisions are made here locally. Generally speaking, you’re one call away from the decision-maker, and the decision-maker knows and understands the market and the people involved in the market. Community banks genuinely care about serving their market.”

Beacon Community Bank’s board is made up of 14 area residents, including Melton; businessman Tommy Baker, who serves as chairman of the board; Vice Chairman Jim Smith; State Sen. Paul Campbell; Luther Cochrane; Rev. Jimmy Gallant; Bill Hall; Nancy Hardwick; Johnny Krell; Gen. John Rosa, who will retire in June after 12 years as president of The Citadel; Medal of Honor recipient Maj. Gen. James Livingston; Pat McKinney; David L. Morgan; and Paul Steadman.

A graduate of Davidson College with a degree in Economics, Melton has been in the banking business for 23 years – his entire professional life. He has worked in both the Charlotte and Charleston markets, establishing an office in the Holy City for CommunityOne Bank in 2015.

Melton said from when Beacon Community Bank was organized in March 2017 until it opened its doors at 578 East Bay St. on Jan. 8, 2018, he spent his time assembling the board, establishing a business plan, raising more than $30 million in capital, setting up operations, and hiring his team of 15 employees.

“It’s a real intense and involved process,” he commented. “It’s been a lot of work. A lot of heart and soul has gone into it. Our board has high expectations. It’s been an incredible journey so far.”

Speaking to a group of business leaders at Halls Chophouse in January, Baker said establishing the bank was “excruciating, but fun.” He explained why he decided to help start the financial institution.

“Simply put, this is our community,” he said. “It’s something this community needed. It’s about serving the people.”

So with the number of community banks dropping across the country, why would anyone think a financial institution like Beacon would survive and thrive in the Charleston area? The major reason for Melton’s optimism is that locally-based banks are in tune with the needs of the customers they serve: local businesses and individuals.

“The experience is totally different with big, publicly-traded banks,” Melton said during his January presentation at Halls Chophouse. “Loan decisions come from North Carolina or Tennessee by someone who sits behind a desk all day looking at loan applications. They’re the complete opposite of local banks.

“On loans, someone here locally is making the call, whether it’s at the management or board level,” he added. “Regardless, it’s all done 100-percent locally. Ten years ago, we had seven local community banks in this area. Most of them have since sold. There’s a real void of locally-based institutions. It’s important to have banks that understand our community.”

Pointing out another asset of locally-owned banks, Melton said employee turnover is much lower because larger banks are more “centralized and bureaucratic” in their decision-making, which in turn has a negative impact on employee satisfaction. It’s important for customers to develop long-term relationships with their bankers, he said.

“We focus on building a culture that fosters long-term employee engagement, which translates into better customer experiences,” Melton said. “In this business, it all comes down to people and culture.”

Melton pointed out that some segments of the banking business have become “fairly commoditized.” For example, people can now shop for car or truck loans online, visiting a bank or credit union’s website rather than its office to find the best interest rate. Other segments of the business world are – and should be – more relationship-oriented.

“Small business owners are dependent on bank debt as part of their capital structure,” he remarked. “They need a good banker they can count on. That’s one of the places where people make a difference.”

Right now, Beacon’s only branch is on East Bay Street, on the east side of the Charleston peninsula, but Melton pointed out that it’s convenient for Mount Pleasant customers because of its location close to the Arthur Ravenel Jr. Bridge. In addition, it’s open from 9 a.m. to 1 p.m. on Saturdays, which is uncommon for a small community bank.

He added that Beacon will add branches as it grows. He anticipates four more locations in the next five years, in Mount Pleasant, North Charleston, Summerville, and West Ashley. He said the bank’s capital will be fully leveraged in the coming half-decade and that additional capital will be raised to support further growth.

Both Baker and Melton agreed that regardless of the risk of opening a new bank in a volatile economic environment and no matter how much work it took to bring their vision to fruition, it was worth the effort.

“We’re focused right now on the next five years,” said Melton. “We have an opportunity to do banking better than it’s been done in quite some time. The best is yet to come.”

“We want this to be a legacy bank, for our kids and our grandkids. We are not for sale,” Baker told the business group at Halls Chophouse.

To Baker, Melton, and the entire board, a community bank is more than just a financial institution – it’s an integral part of the community it serves. As Chief Lending Officer Andy Thomas told the group at Halls: “A good banker has a pair of muddy boots in his car.”