In early September, First Citizens Bank announced the official launch of its Middle Market Banking unit across the Southeastern U.S. The launch of this unit follows First Citizens' merger in January 2022 with CIT Group. First Citizens Middle Market Banking serves clients across North Carolina and neighboring Southeastern states, including Virginia, South Carolina, Georgia and Florida, with a full-suite of banking services including senior secured loans, cash-flow loans, capital markets services, foreign exchange capabilities, asset-based lending and treasury and payments services focusing on middle market clientele with $75 to $750 million in annual revenues.

ABL Advisor met with Middle Market Banking Executive Brendan Chambers to learn why the bank is expanding in the middle market at this time and how his team will approach the highly competitive middle market banking landscape.

ABL Advisor: Brendan, please tell us about your role with the bank and why the southeastern region of the U.S. is such an important geographic region for the middle market group?

Brendan Chambers: I'm very proud to be leading this effort for First Citizens. It's an honor to work so closely with so many talented people bringing the best financial products and banking expertise to the dynamic businesses that occupy the middle market space. It's obviously something that we are very excited about. We are initially launching our middle market banking business in the Southeast and we have teams in the Southwest as well. First Citizens has a very strong presence and long history in the Southeastern market and that is why we've chosen to start our launch in that region. We have a team of banking professionals with deep expertise, experience, and long-term relationships and we're focused on providing a full suite of banking services to the middle market client base.

Our focus is on long-term relationships, which is one of the key things that differentiates First Citizens from other banks that operate in this space. As you may know, we're the largest family- controlled bank in the United States and we are continuing our unique legacy of strength, stability, and long-term thinking that has spanned generations through the evolution of this business. Of course, we've gained some talent through the CIT merger, as CIT had a wealth of middle market banking expertise already in Southern California and part of the Midwest markets. In addition, we have recently supplemented our team by recruiting some additional experienced bankers in the Southeastern market. We've also enlisted some personnel from inside the bank to support this business. So, we're excited about all this growth.

First Citizens has always supported middle market companies. The CIT acquisition boosted our capabilities – particularly by adding skilled credit expertise that will empower us to take a broader perspective and be even more flexible when evaluating financing options for our clients. By acquiring CIT, First Citizens has vastly expanded our middle market banking capabilities to include capital markets expertise, foreign exchange services, equipment leasing, asset-based lending and much more. First Citizens also acquired deep expertise in financing many middle market client verticals, including telecom, energy, healthcare, commercial real estate, and some others. I feel strongly that when you bring the two businesses together, we end up with this very strong platform, and a great go-to-market strategy in many of the high growth markets across the United States.

ABL Advisor: Is your responsibility on a national scale and are there plans to expand into other parts of the United States?

Chambers: Yes, my responsibilities are national. Today, First Citizens operates in 20 states across the country. Obviously, the Southeast is critically important because that's where First Citizens has built its brand. But we are now a coast-to-coast bank and today we have middle market teams that operate in the Midwest and Southern California. We have broad plans over the next three to five years to build out some other high growth markets where we have presence. We are focused very much on building relationships with companies between $75 million and $750 million in revenues. We're focused on building out the markets where we have a significant presence and then expanding into other high-growth markets from there. You will see us continue to add different markets onto this platform, but for now we are focused on launching in the Southeast.

ABL Advisor: How will this group work with other lenders (C&I, CRE for example) from the bank to service current and prospective borrowers?

Chambers: Leveraging the strength of the First Citizens and CIT merger, we're launching this new middle market banking business to provide clients with the best-in-class relationship banking experience to support their growth. Our intent here is to leverage our established brand and core markets to deliver the capabilities of the combined organization to meet the lending, cash management, capital markets, wealth management and insurance needs across our footprint. With our capital markets expertise, we are capable of lending into large transactions and collaborating with other financial institutions. We are absolutely focused on leveraging the full bandwidth of the CIT and First Citizens platform.

ABL Advisor: What types of lending do you anticipate will provide the greatest demand (asset-based lending, cash flow loans, senior secured debt)?

Chambers: Initially we expect that senior secured loans and asset-based lending are where we'll see the most demand. That's proven itself out in the last several months. We're well-positioned to work with our colleagues across the entire enterprise to bring our full capabilities to middle market clients.

ABL Advisor: Are there any industries you feel will provide the greatest opportunities for the new group considering the current economic environment?

Chambers: As middle market bankers, we are generalists and therefore we are industry agnostic. Unlike many other financial institutions supporting the middle market, we're not an investment bank. Therefore, we are not seeking solely to help on the sell, buy or M&A sides of business. Instead, we're relationship bankers that are focused primarily on using the full suite of banking services to help our clients' businesses compete, grow and prosper.

ABL Advisor: We are currently in a rising rate environment with rising inflation just to name a few of the economic dynamics affecting the market. What impact do you feel this environment will have on deal flow and the competitive nature of the middle market?

Chambers: As you mentioned, today we have inflation, rising interest rates and a ton of other economic headwinds out there, which clearly introduce some uncertainty into the market and pose difficulties for clients seeking to grow their business. All banks serving the middle market are faced with the same set of economic challenges. From my perspective, it's about how you respond to the challenges in the environment that we are all facing. I believe our bankers and partners are uniquely positioned to help clients address those issues and help navigate through what could be some uncharted waters to come.

That truly is the beauty of this merger in my mind. We have the First Citizens brand, capital base and long history of direct relationship calling. Additionally, we have all the product services and capabilities for the upmarket clients that CIT brings. When you put them together, you have a very powerful platform for middle market banking nationwide.