FINANCIAL INDUSTRY First Place Bank to open branches outside Valley

The local bank wants to expand to Cleveland and perhaps Columbus and Dayton.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
HOWLAND -- First Place Bank has tasted expansion and likes it.
The Warren-based bank has set up seven loan production offices outside the Mahoning Valley in places such as suburban Cleveland, Dayton and Columbus.
Its offices in Cleveland are doing so well that they are producing more than half of the company's total mortgage loans.
This success sets the stage for opening full-service branches in suburban Cleveland and perhaps other areas, said Steven Lewis, bank president and chief executive.
He told shareholders of First Place Financial Corp., the bank's holding company, that he is looking to open new branches outside the Mahoning Valley.
Looking elsewhere makes sense because this area is not growing as fast as other areas and First Place already has the No. 1 market share here, Lewis said at the company's annual meeting Thursday at the Avalon Inn.
It's a much better investment to build a branch in a high-growth area, he said.
Lewis said after the meeting that he expects two suburban Cleveland branches to open next year, one on the west side and one on the east side.
What happens next depends on how well those branches do, he said. First Place could open more branches or acquire another bank, he said.
Down the road, bank officials expect to look at Dayton and Columbus as areas for new branches, he said.
Slow and steady
Noting that other banks have gotten into financial trouble by expanding too quickly, Lewis said any expansion will be deliberate.
"We're not in a huge hurry. We want to do it right," he said.
Lewis said he doesn't want to make a mistake on a bank location because branches cost about $1 million to build. Bank officials want them to become profitable within 30 months.
Lewis said the Cleveland and Columbus markets are good opportunities for expansion because large banks are gobbling up smaller ones.
Few locally based community banks are left in those areas, yet many people prefer to deal with smaller banks, he said.
"We want to maintain our community bank identity no matter how large we get," he said.
A shareholder questioned Lewis about the possibility that BB & amp;T, a bank holding company based in North Carolina, will come into the area and make a bid for First Place.
Lewis said shareholders would be informed of any formal purchase offer but added that First Place has not been approached by BB & amp;T.
He said that company has indicated it wants to expand into Ohio and Florida, and an industry analyst speculated in a report several months ago that First Place was one of several possible targets.
The focus
First Place officials instead are focused on growing, he said.
Since selling stock to the public in 1998, First Place has had the money to spend on growing, but officials first wanted to make sure the organization was prepared, he said.
Mergers with FFY Financial Corp., the parent company of Boardman-based FFY Bank, and Ravenna Savings Bank were completed and some internal changes were made recently.
First Place reduced the amount of car loans it handles through dealerships and replaced that volume with home equity loans and lines of credit, which are safer and more profitable. It has sold its long-term mortgages but retained the rights to service those mortgages.
First Place has created a commercial banking unit and installed a sales and service culture among all employees, Lewis said.
He said the last piece to put in place was the acquisition this week of APB Financial Group of Cranberry, Pa., which provides wealth management services and administers pension plans. First Place already acquired companies that provide real estate, insurance and title services.
In other matters, Lewis announced that Therese Liutkus is leaving her job as chief financial officer to spend more time with her family. She will be replaced by David Mead, who was hired six months ago as treasurer after being chief financial officer at Capital Bank in Toledo.
shilling@vindy.com