Less than 10 years after its founding, Williamson County’s largest lender Franklin Synergy Bank has hit more than $3 billion in total assets.
The bank hit the asset milestone late Tuesday night, according to CEO Richard Herrington.
“I’ve been downstairs counting deposits,” Herrington joked. “In all seriousness, we’re not focused on being the largest bank, but it’s a good measurement of success in our community.”
He said there are 570 banks with assets between $1 billion and $10 billion. Using those banks’ compounded annual growth rates from third-quarter earnings for the past five years, Franklin Synergy would be the country’s ninth-fastest-growing bank based on asset size, with a compounded growth rate of 48.8 percent.
Herrington said when he and his partners launched the bank, Franklin Synergy was the smallest bank headquartered in Tennessee. Now, he says, the bank is the fourth-largest.
Memphis-based First Tennessee Bank, Nashville’s Pinnacle Bank and FirstBank are the three banks that lead Franklin Synergy.
Herrington said the majority of the bank’s quick growth is the result of organic growth, not acquisitions. Franklin Synergy has only completed one acquisition since its founding. In 2014, the Williamson County bought MidSouth Bank in Rutherford County for $38 million. The deal put Franklin Synergy over the $1 billion in total assets milestone.
The bank’s would-be second acquisition — a $30 million buyout of Nashville’s Civic Bank & Trust— has been on hold since regulators put Franklin Synergy under additional scrutiny. The deal was originally delayed over compliance questions, but was then further delayed after Franklin Synergy was placed under a memorandum of understanding for its commercial real estate risk-management policy.
Herrington said he hopes to have the bank’s regulatory issues cleared up after regulators revisit the bank in March, opening the door for the bank’s Civic deal to receive the proper approval.
Despite regulators’ extra attention, Herrington said Franklin Synergy remains focused on its growth trajectory, since quick growth has continued to be a hallmark of the bank.
In September, Franklin Synergy Bank jumped two spots in the Federal Deposit Insurance Corp.’s annual market share ranking, up to No. 6, with 4.3 percent of the area’s deposits. In one year, the bank added nearly $750 million to its local deposits, bringing its total deposits to $2.3 billion.
In November, the bank raised $72 million in new capital on the public markets to help fund future growth. Herrington said this capital raise played a critical role in getting the bank over the $3 billion hurdle.
And while he said the bank has no definitive goals about what size it hopes to be, it would not be unrealistic for Franklin Synergy to hit $4 billion or $5 billion in total assets over the next year or two.
“With the capital we have, we can certainly grow to $4 billion or $5 billion without any new capital,” Herrington said.
Meg Garner covers banking, government and law.
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