Magazine article American Banker

Atlanta's Bank South Applies for Conversion to a State Charter

Magazine article American Banker

Atlanta's Bank South Applies for Conversion to a State Charter

Article excerpt

Following a national trend, Bank South Corp. is seeking to escape federal regulation by converting to a state charter.

Bank South, which is based in Atlanta, filed an application with the Georgia Department of Banking and Finance and disclosed its plans to the Office of the Comptroller of the Currency at the end of May. Chairman and CEO Patrick L. Flinn said he expects approval by June 29.

"It's 50% less expensive for us to be a state-chartered bank," Mr. Flinn

said. "And since we're just in Georgia, there was no reason not to have as

our primary regulator the people here - sort of a closer-to-home kind of thing."

Bank South, which has $7.7 billion of assets, operates branches across the state but is concentrated in metropolitan Atlanta. It sold its one out-

of-state property, a bank in Pensacola, Fla., to Jacksonville-based Barnett

Banks Inc. in 1993.

Mr. Flinn estimated Bank South would save $500,000 a year by converting

to state regulation, from an annual expense base of $262 million.

"It's not very much," Mr. Flinn said. "But I would also say that's not the only regulatory cost we have. Everything we do with the federal regulators is about twice as much - every application we file, whether it's

for a branch or whatever."

Bank South, which suffered serious credit problems at the end of the 1980s, has been in a growth mode the last three years. Acquisitions added $3 billion of assets. Mr. Flinn said he also expects to build seven to 15 branches this year, most of them in grocery stores.

Bank South's decision to convert from a federal charter means that the three largest banks headquartered in Georgia will be state-regulated. …

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