Proxy fight leads to new bank management
- July 30, 2012
Michael Larrowe says there is a “lot of interest in the Bank of Floyd” in Floyd County because of recent management changes. In May, Larrowe succeeded Leon Moore as president and CEO of the bank after a new board of directors was elected in a proxy fight led by the company’s largest shareholder, North Carolina investor Douglas Schaller. Larrowe also was elected CEO of Cardinal Bankshares, the bank’s parent company.
Ironically, before the proxy vote, Larrowe had been the second-ranking executive at the bank and one of the targets of Schaller’s frustration with management. Larrowe believes Schaller was “drawing conclusions” before getting to know him. “The local folks he associated with were able to get to know me, and that might have triggered his reversal,” he says. “He came to understand that my ideas were not a reflection of the way the bank had operated in the past. They were more in line with what the coalition wanted to bring to the bank.”
The coalition led by Schaller wanted the bank to create customer-focused products and services. To accomplish that, Larrowe says, the bank needs to put the appropriate tools in place, whether it’s technology or employee skills to deliver services customers want. The bank, which has $272 million in assets and operates seven branch offices in the region, will conduct a comprehensive evaluation of its information technology capabilities this summer and begin adding new products.
The banks also will hire a new chief loan officer and a new credit officer. “These are classic positions, but we have not had an individual assigned to those duties alone. We want to provide a better focus,” Larrowe says. “Our objective is to be more responsive to our customers and to do that we needed to have a little deeper skill sets in those two areas.”
The proxy contest was challenging, but Larrowe is encouraged by the fact that shareholders owning more than 94 percent of the outstanding stocks cast votes. “That large percentage in the shareholder vote was evidence of the interest in the bank,” he says. “I think we have a good future.”