Barely a decade after the city of Cullman was founded in 1873, a group of 30 original settlers organized a bank called Cullman Building & Loan. While that name has changed several times along the way —
it is now known as Cullman Savings Bank— the financial institution behind it has remained an integral part of the city and Cullman County ever since.
Now, after more than a century of operating as a privately owned entity, Cullman Savings Bank has officially gone public. Final approval for the change was made on July 2, allowing for the small-town financial institution to be listed on the NASDAQ stock exchange right alongside the likes of Amazon and Apple.
“You can look on the financial pages and see this little bank in northern Alabama trading on the stock market,” Cullman Savings Bank President and CEO John Riley says. “We have people from New York and Chicago buying our stock.”
It is a moment that has been in the works since 2009, when the financial crisis led to Cullman Savings making a partial conversion by selling 45 percent of its stock on the market. That percentage was traded on the OTC (Over the Counter) Bulletin Board, and the initial offering raised more than $16 million for the bank.
Riley says the decision was made to sell the remaining 55 percent of the shares and go fully public this year in order to have Cullman Savings “look more like everybody else” in the region, since the number of mutual savings banks throughout the Southeast is dwindling.
“As one of the last mutuals in the state of Alabama and even in the South, we were kind of the odd duck out there,” Riley says. “We’ve gone through this 10-year process of going from a mutual, which nobody understands, to now we’re a fully converted stock-trading bank, which everybody understands. That makes it a little bit easier doing business in the banking world. You don’t have to spend 20 minutes explaining what kind of bank you are.”
Riley says customers won’t notice any significant changes in the way the bank conducts daily business. However, he points out that depositors now will have the opportunity to truly own a piece of the institution, which he says will further strengthen the longstanding ties between Cullman Savings and the local community that shares its name.
“It gives the people who helped build up this bank the opportunity to own part of it,” Riley says. “Now we have customers who can purchase stock, and when they do that, they pay a little more attention to how we operate. They’re going to start
getting dividends. It’s an investment in this place,
and I think that will make them feel a little bit more a part of what we do here.”
Riley says most of the bank’s established customers have a good comprehension of what is taking place, since Cullman Savings went through the partial conversion in 2009.
“We answered a lot of questions back then,” Riley says. “This time through, most of our customers and now our stockholders understand what we’re doing. So the community has been nothing but supportive. The questions or concerns have been minimal.
They understand it. The main feeling throughout the community has been excitement.”
Riley says the stock offering will raise more capital for the bank. Some of those funds will go toward the Cullman Savings
Bank Foundation, which was established in 2002 to help
support local projects in the community and provide college scholarships for area students.
“When we went to the stock offering the first time, we were able to donate some stock to the foundation, which helped build it up,” Riley says. “Now we’re putting more stock into the foundation.
So, it has a fairly good amount of assets that we utilize to fund a lot of different projects around town that affect the community in a positive way.”
The bank hopes to use the change to public company status “as a way to give back to the community that basically has put all the money in here over the last 130 years.”