Oklahoma Bank to Focus on Small Businesses

After two years of preparation, Central National Bank in Enid, Okla., will focus its growth strategies on penetrating Tulsa’s small business market.

“Obviously the growth for the bank is going to come from the Tulsa location and the northeastern part of the state,” said Kip Herburger, Central’s senior vice president and east regional manager. ” This is Central’s only metropolitan location. Population-wise, small business-wise, there’s numerous opportunities out there for us.”

Central’s target: 15-percent growth in its $52 million in Tulsa branch assets.

“Ideally at the end of 2010, we’d love to be at $60 million,” said Herburger.

The $505.6 billion-asset lender also hopes to double Tulsa’s $4 million deposits.

“That takes a little more effort to get deposits in the bank,” he said. “If we do a customer’s loan, we want them to be able to move their deposit portfolio over to us.”

After a stabilizing year in 2009 that saw the 180-employee Central National Bank record $5.4 million in net charge-offs and a $915,000 net operating loss, Central finished 2010’s first quarter with a 13.8-percent jump in net operating income to $714,000.

Total deposits stood slightly below year-ago levels at $420.7 million. Net loans and leases dropped 8 percent to $391.5 million.

“Every market is forecasting growth for 2010,” said Herburger. “We haven’t finalized a budget for 2011, but we also anticipate growth that year for all of our markets.”

The Tulsa branch opened two years ago as a loan production office in leased space at 63rd and Memorial. Last October it evolved into a full-service branch with its move to 7,500 square feet at 4880 S. Lewis, suite 101. That gave 97-year-old Central its 10th branch, the others serving Enid, Bartlesville, Blackwell, Mooreland and Woodward.

“The first six months we’ve been here have actually been occupied with us getting stabilized, getting comfortable at the one location, getting staffing at the right levels,” said Herburger.

With 12 employees in Tulsa and one or two more slotted, Herburger said Central will now take a more active role in penetrating Oklahoma’s second-largest metropolitan area. Its marketing efforts will range from a new corporate website to heightened advertising, including live remotes with Tulsa’s Sports Animal 97.1 and direct mailers to the branch’s surrounding neighborhoods.

“To be certain, we are going through an entire rebranding,” said Central’s ITS Marketing Manager Tania Warnock. “Our move to the Tulsa market is driving a lot of that. Tulsa is very competitive where banks are concerned, and there is a strong feeling here that we need to look and play the part of a big bank with multiple branch locations, but still retain the personal touch that is indicative of a community bank. The way we present ourselves on the Web helps us accomplish that.

“Additionally, we realize the important role a Web site plays in communicating to our existing and future customers,” she said in an e-mail. “We will be utilizing our website to communicate with our customers about specials rates, new products, fraud alerts, and just about everything else.”

The Tulsa Metro Chamber started things off with a ceremonial office ribbon cutting, followed with a reception and private art viewing of works by wildlife artists Jan Martin McGuire and James Gary Hines. A portion of their sales will benefit The Nature Conservancy’s Oklahoma Chapter.

With small business representing 75 percent of its customer base, the Tulsa branch intends to generate strong word-of-mouth advertising for growth in 2010 and ’11.

“Myself and a couple of the loan officers that are here have good relationships throughout the city and we’ll focus on that,” Herburger said. “We make a good fit for small businesses. We are very service-oriented.”

Although the recession continues to rage, Herburger said Central expects to grow its commercial loan base. He said many Oklahoma sectors it serves now demonstrate signs of recovery.

“Our focus is primarily more relationship-driven rather than transactional,” he said, although he stressed that the bank is making business loans.

“For the most part in the discussion we have with customers, everyone seems to have a more positive outlook on the future,” he said. “We’re seeing some of our orders picking up. There’s also still different sectors in the market that are not seeing the turnaround as rapidly as others are. It’s a mixed signal that we’re getting.”

Information from: The Journal Record