Troy Bank charter keeps it close to home

A trust created by the bank's founder solidifies its future as an Alabama-based bank

Troy Bank and Trust President Jeff Kervin in downtown Troy, always the bank’s hometown. Photo by Julie Bennett.

Bank mergers can be frustrating for customers. There’s an unfamiliar bank name and account number to remember, new checks and maybe even different locations and tellers.

Mergers and acquisitions are common in the banking industry. In 2022, the Federal Deposit Insurance Corp. approved 68 bank mergers nationwide — four in Alabama.

No one will take over Troy Bank and Trust in Pike County, though. Ever. Their charter forbids it.

Former Alabama Gov. Charles Henderson was a founder of Troy Bank, which opened in 1906 with $50,000 in capital stock.

When Henderson died in 1937, his will created a perpetual trust in his name. It transferred his 51.12% majority ownership of Troy Bank and Trust stock to the trust. Those shares can never be publicly traded.

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Today, Troy Bank has assets of $1.42 billion, just over 53,000 customers and 15 locations in Pike and surrounding counties, East Alabama, the River Region and the Wiregrass — including Enterprise, Auburn and Dothan — and plans to expand.

“We can buy other banks. They can merge with us, but no one will ever, ever be able to come and take Troy Bank and Trust away,” says Allie Higgins, bank marketing and public relations director.

“We’ve been Troy Bank for over 100 years. We’ll be Troy Bank for 500 more, forever and ever, amen, because of the security that the trust has provided to us,” she says.

Henderson and his wife had no children but did have relatives who challenged the restrictive ownership provision of his will.

They lost.

“That has been taken to the Supreme Court twice and upheld,” says Higgins.

She calls bank founder Henderson a visionary who did many good things for the state and Pike County. He was governor from 1915 to 1919.

“You just have to think about the insight that man had over 120 years ago to set up something that was going to outlast him that long,” she says.

Troy Bank is a powerhouse in Southeast Alabama, where Pike County is the nucleus of its legacy market.

“The roundabout figure that we normally use is that we have 80% of the market share here,” Higgins says.

The original Troy Bank building still stands on North Three Notch Street downtown, but the main branch moved just two buildings away to 70 West Court Square.

Troy Bank can – and does – absorb other banks.

“We have bought other banks before and they have become Troy Bank and Trust, but someone couldn’t come in and buy us,” explains Higgins.

“We’re centered (in Troy) but we’re everywhere, and we’re growing and growing,” she says. “In the coming years we’re looking at expanding into Huntsville and into Gulf Shores and Mobile. We’re starting to be all across the state.”

Help the community

The original goal of the philanthropic bank trust was to address health and educational needs in the region. Early-childhood health care was not readily available in rural Alabama during Henderson’s lifetime. Many residents were illiterate, too.

“It started in Pike County schools and childhood health because he saw a need for that during the war,” says Higgins.

The Charles Henderson Child Health Center’s mission is similar to St. Jude Children’s Research Hospital in Memphis. Established to serve children in the Pike County area, the Troy-based operation now assists families in 12 counties, Higgins says, with pediatric and dental care, nutrition and vaccinations — even a reading program and interpreter services.

“Our funding is what gives them the ability to serve the people in this area that need it the most,” she adds.

The center has connections with health care specialists “you wouldn’t dream of having access to in this area,” Higgins says.

If families are able to pay they do, but “no child is turned away,” says Higgins. “They look at health care as more of a ministry than a business.”

Troy Bank and Trust employees support the community in other ways, too. Higgins is a frequent speaker at Troy University. Bank employees discuss financial literacy in schools and sit on governing boards of charities and non-profits. The bank offers interest-free mortgages on Habitat for Humanity homes. Some employees help build them.

Troy Bank and Trust executives from left, Jon Gordon, Jeff Kervin, John Ramage and Bo Coppage in downtown Troy. Photo by Julie Bennett.

A friendly face

The most immediate impact for the local community, though, is providing stable hometown financial services and familiar faces at the teller window.

“We offer this personal service of a small-town bank, even though we’ve grown into a large community bank,” Higgins says. “We still offer that same hometown service. What we’ve realized is that means more to people than any interest rate or any service ever could.”

Bank employees pride themselves on personalized, responsive customer service, Higgins says. When customers call the bank, they “get a person, and that person helps you.”

Bob Whaley, owner and president of Whaley Pecan Co. in Troy, agrees.

“They’re always just a phone call away,” says Whaley, who has both business and personal accounts with the bank. “We have been banking with them well over 50 years. My father was banking with them, then I started banking with them.

“They’ve always done what they said they would do,” he says, and “helped us with expansion and equipment purchases when we needed them.”

Whaley Pecan, founded in 1937, handles more than a million pounds a year of in-shell pecans and ships nuts and pies across the country.

Despite their extensive reach, “we prefer to do our banking locally,” Whaley says.

It’s a good bet that bank tellers recognized Bob Whaley’s father when he came in to do business decades ago. Employees take pride in knowing customers’ names, faces and their families.

When Higgins was a teller, she waited on an elderly man who had been a customer at Troy Bank since 1910 — just four years after it started. Many of the roughly 180 bank employees work there for years — even generations.

“In the two years I’ve been here, I’ve seen three people retire that had over 50 years of service with us,” she says.

If a customer is looking for a competitive loan rate, for example, Higgins says, “any loan officer is going to do anything they can to make it happen for you.”

As for someday challenging the no-merger provision, Higgins says “we wouldn’t want to.

“It’s an amazing thing that we can’t be bought. It offers employees job security. It offers customers security.

“If you are a customer at Troy Bank, you will never have to go through a merger. Your account numbers are never going to change. You bank with Troy Bank and you will bank with Troy Bank as long as you live.”

Deborah Storey and Julie Bennett are freelance contributors to Business Alabama. Storey is based in Huntsville and Bennett in Auburn.

This article appears in the July 2023 issue of Business Alabama.

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