Gordon Teel Sr. was a charismatic CEO with a yacht and a south Georgia hunting farm he deployed to entertain real-estate developers as he built the second-largest Atlanta-based bank in the mid-2000s. Then, the recession slammed Atlanta, and Teel’s Georgian Bank collapsed in 2009, costing the Federal Deposit Insurance Corp. more than $800 million.
There to pick up the pieces was Peter Bristow, the chief operating officer of First Citizens Bank of South Carolina, which acquired Georgian in an FDIC-assisted transaction in September 2009. “Peter was dispatched to Atlanta and spent 80% of his time there for a year, working through a very troubled loan portfolio,” says Jim Apple, the retired president of the Columbia, S.C.-based bank. “On that and other deals, he proved very effective in crisis situations.”
First Citizens BancShares Inc., which for 50 years ran separate banks in the Carolinas, has grown by pouncing on similar, often low-risk opportunities to create the nation’s biggest family-owned bank. The Holding family controls more than 70% of the Raleigh-based company, which had a market value of $5.3 billion in mid-May. Among the lesser-known of the family members, at least in North Carolina, may be Bristow, who is now president and oversees the company’s Carolinas operations, along with parts of Georgia, Virginia, West Virginia and Wisconsin. He also leads the mortgage and sales finance businesses.
Bristow, 52, is the brother-in-law of Frank Holding Jr., 56, who is in his 10th year as CEO; and Vice Chairman Hope Bryant, 55, who is responsible for offices in 13 other states where the bank operates. Over the last decade, First Citizens’ shares increased 230%, nearly double the Standard & Poor’s 500 index and triple the gain of the XLF exchange-traded fund made up of the biggest U.S. banks. With his north Raleigh office situated between the other two executives, it’s important that the trio get along — and Bristow says they do. “We are all on the same page,” he says. “We’ve done a good job of that.”
Started in Smithfield in 1898, First Citizens is now the 55th-largest U.S. bank, with $34 billion in assets. Led for decades by Lewis “Snow” Holding and his brother, Frank Holding Sr., 89, the bank has acquired more than two dozen smaller institutions across North Carolina over the last 50 years, many of them in financial peril. (Both Holdings are deceased.) Lending to medical professionals and a conservative approach have been hallmarks. First Citizens’ charge-offs from failed loans have averaged $1 for every $1,000 lent over the last two years.
“Nothing has changed for us in the way we do business or changed about our credit appetite,” says Bristow, whose wife, Claire, is one of five children of Frank Holding Sr. “That’s an important element of being family controlled. We’re not chasing trends or whatever is hot.”
The graduate of the University of Virginia joined the bank in 1991 after working for insurers in London, England, and his hometown of Richmond, Va. While Frank Holding Jr. and Bryant have spent their careers in North Carolina, Bristow worked exclusively at the South Carolina bank and was president from 2001 until 2014, when the family’s two banks merged. Operating dual banks provided some independence between Snow Holding, who led the N.C. business, and Frank Holding Sr., who oversaw South Carolina, says Apple, a 22-year bank employee.
While in South Carolina, Bristow helped integrate acquisitions to create an $8.5 billion institution, the largest bank based in the Palmetto State before the merger in 2014. (He also had stints on the boards of the state lottery and retirement-system boards.) In many of its deals, which have also helped expand First Citizens’ footprint into many new states, the FDIC took over much of the bad debt, leaving the bank with a hobbled but valuable collection of offices, customers and employees.
In Raleigh, Bristow has spent much of his time blending the two organizations. He ranks among the bank’s highest-paid executives, receiving total compensation of $1.4 million last year, a filing shows. He and his wife control about 8% of company shares.
Bristow won’t disclose merger savings but says employee retention and other metrics have outpaced initial projections. “We didn’t destroy a lot of value on the way,” he says. “There were some economies, but if it was a feet-on-the-street employee, we left them largely intact.”
Like most banks, First Citizens isn’t adding many new offices as more customers favor online services. It was different in the early 2000s, when it added about 35 South Carolina offices within five years, Apple says. But the bank also isn’t closing offices en masse, nor abandoning its many rural markets, Bristow says. The merger wave that has left many cities without a locally owned bank has helped First Citizens, he adds. “We still have branches in some small towns with 12 tellers across the front of the bank.”
One of Bristow’s current projects — another classic First Citizens’ growth play — is leading the integration of Guaranty Bank, a $1 billion suburban Milwaukee bank that failed in May 2017 because of soured mortgage loans. As part of the government-assisted transaction, the bank’s 107 grocery-store branches closed, leading to the dismissals or planned layoffs of about 600 Guaranty employees, or about 60% of its staff, the Milwaukee Business Times reported last month.
While First Citizens’ far-flung markets are led by Bryant, the bank put Bristow in charge of the Milwaukee project because of his retail and merger experience. He also carries the lessons from the Georgian Bank days. “Our core business has maintained pretty good growth, and we manage our expenses pretty well. The kicker for us is the distressed deals, which have really enhanced our earnings. For us, it’s a core competency.”