Writer: Max Crampton-Thomas
2 min read May 2021 — United Bank is a subsidiary of United Bankshares, Inc. (UBSI) and has consolidated assets of approximately $26.2 billion with 204 full-service banking offices and 20 loan origination offices located throughout the Mid-Atlantic and Southeast. Raleigh-Durham Market President Taylor Vaughn spoke with Invest: about the bank’s strategy in the region and the challenge of processing and issuing the PPP loans.
How do Raleigh and the surrounding area fit into United Bank’s strategy?
We are a vehicle for growth. United has been trying to get into the Carolinas for a long time now. We were founded in West Virginia and moved over to the D.C. market in the early 1990s and we have very strong penetration in those markets. The next logical step was to move into the Carolinas, and I would say Raleigh and Charlotte are the target markets for United’s growth in our regional footprint. From a pure economic and job growth perspective, there are a lot of people moving here. We came into the market through the purchase of CresCom Bank, which has a strong presence on the coast and was headquartered in Charleston, SC.
Right now, it is about building the brand and letting people know how we do business. That can be very difficult in banking, especially if you’re an outsider, and I think a lot of that feeling comes from the number of mergers taking place in banking. United has been independent for 182 years and we have a remarkable track record. We plan to be here for the long haul and grow alongside local businesses. People are now more important than they have ever been. Banks and bankers had been commoditized in the last few years and people were chasing the best transactions, not necessarily the best banking relationship for them and their organization. At United, we’ve always been relationship driven and I think that over the course of the past year, a lot of people found out that it is more important to have a partner in a bank rather than a counterparty to a transaction. We felt it was our responsibility to the community to continue investing because a lot of the time it takes leverage to make things work. Many other banks hit the brakes on putting money out the door in 2020 but we did not slow down.
We attract business based on reputation, our history of performance and ability to close. Seaboard is a prime example of having a deep relationship in another market that translated over to success here in the Triangle. That customer was moving into a new market at the same time we were and we had already established some intrinsic trust based on our existing relationship. It was a big project for the area, and we knew we had phenomenal sponsors. We are very familiar with how we each operate.
How has the low interest rate environment influenced your lending activity?
This makes it difficult for us as a bank but all our peers are facing the same challenge. We are fortunate because we own two residential mortgage companies, including George Mason Mortgage out of Northern Virginia and Crescent Mortgage out of Atlanta. Both had record years due to refinancing activity. And because we are a well-rounded relationship bank, we do not just have one product, that allowed us the flexibility to have a record year at a corporate level. As interest rates rise, that residential mortgage activity will taper off a bit, due to a decrease in refinancing volume, but United will be able to rely more heavily upon other services like; commercial banking, treasury management, brokerage, and wealth management.
What was the bank’s experience with the PPP loan system and what were the main lessons learned?
During the first round, the bank did about 9,000 PPP loans. In the first 10 to 12 days we processed the equivalent of a full year’s worth of loan production. Our entire staff really stepped up. We were well insulated at the bank due to strong capitalization and we were actually able to raise our minimum wage during the pandemic, as well as give spot bonuses to those who had to travel to the office due to job requirements. For the second round of PPP, we brought a little more knowledge and technology but then PPP rules changed again, leading to some complications. It’s very difficult for us to seamlessly execute when the goalpost is constantly being moved but we understand the more money we can get out, the better off people in our communities will be. So very much a head down, keep moving forward approach. It’s been a good lesson in remaining flexible, and our success with the program is a testament to the strength of our people and culture.
In addition to PPP loans, United’s broader COVID response was recognized on a regional level by the Washington Business Journal. Richard Adams, CEO and Chairman of United Bankshares Inc., was honored as CEO of the Year for COVID-19 Response. This award was given as recognition of United’s efforts and commitment to its employees, customers and communities during the COVID-19 pandemic.
United Bank put in place a comprehensive response to the ongoing COVID-19 pandemic. The past year was unlike any other in modern history, causing a lot of companies and organizations to pivot or completely overhaul the way they do business. We did not seek to change our business strategy during the global COVID-19 pandemic. We relied on the values and principles that have guided us successfully throughout our history and remained committed to actively supporting our employees, customers, shareholders and communities.
Taking care of our employees is a top priority and not a single United Bank employee missed a paycheck or faced lay off due to the pandemic. In fact, in addition to offering unlimited COVID-19 pay throughout the spring and summer for employees needing to take care of themselves or loved ones, we issued a special COVID-19 bonus to employees who were required to report to work in-person as an essential worker during the quarantine period. Additionally, United increased its minimum wage companywide and 401(k) company match this year. Lastly, we quickly transitioned the 2020 summer internship program to a digital format. In Summer 2020, 13 college students from across our footprint participated in United’s remote internship program.
Also, in addition to raising and donating funds to many nonprofit organizations in our communities, team members spent numerous hours outside of work volunteering at various events in their local areas. In 2020, we worked to adapt our volunteer strategy to be responsive to community needs, while taking precautions to ensure employee and community safety.
Here in the Raleigh/Durham Market, United donated $2,500 to the CAHEC Foundation, a nonprofit partner that identified numerous working families and children in the area facing challenges as they navigated virtual learning. Many did not have the option to work remotely and were forced to find childcare – an expense they were not used to paying on a fixed income. To mitigate the expense, CAHEC sought to provide scholarships for children in need to attend the Scholastic Support Center of the YMCA of the Triangle. United Bank’s donation provided 10 children with scholarships to receive help with online learning, a warm meal daily and the opportunity to stay active, all while giving their parents or guardians peace of mind knowing the children are in a safe learning environment while they’re at work.
How are you reconsidering your branch strategy as you continue to grow?
In the Triangle, this does not change much as we have a limited footprint. We have two commercial lending offices and two full-service branches in a market of 1.2 million people, which is not enough of a physical presence in my opinion. We are a lean operation, and we operate very efficiently but I think looking at the data, the Triangle may be the one market where everyone is trying to build their branch presence rather than cutting it back. I think we will be following that trend.
What are your main goals for 2021?
Looking at the size of the bank and comparing our global portfolio with our exposure in the Triangle, we’re underbalanced. We’re very much looking to have a strong year of growth and excited to start building relationships with new clients and expanding our existing relationships. I think our goal is to double our investment in the market this year, and I expect we will look to compound that trend over the next three to five years.
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