Rebounding from the Downturn

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Community First Bank & Trust
Columbia, Tenn.
ROAA in 2015: 3.63 percent
ROAE in 2015: 37.96 percent
Assets: $467 million
Retail locations: Eight
Employees: 109
Founded: 1998
Website: www.cfbk.com

By Jon Thompson

Community First Bank & Trust had an extraordinary 2015. It was the culmination of efforts over the past four years to recover from the impacts of the downturn in the economy that began in 2008. Our local market was heavily impacted by the decline in property values and high unemployment rates, both of which lingered for several years. Thanks to the hard work of our employees and significant financial commitment from our directors and some key shareholders, we were able to preserve local control of our bank, restructure its capital and restore our company to sustained profitability.

There were some very difficult days along the way, including a complete change in our bank’s executive management team and essentially rethinking how we executed our business from the ground up. This was successful thanks to the level of commitment shown by everyone involved: Directors provided oversight and additional investments; management team members with varied but complementary experiences worked together to implement needed changes; and our employees were willing to be flexible and to adapt to all of the changes to their day-to-day jobs.

The largest component of Community First Bank’s earnings in 2015 was a reversal of a $10.6 million valuation allowance on the bank’s deferred tax assets. That was a substantial event for the bank, but it was also the capstone of other efforts that came to fruition during 2015. The bank became subject to regulatory orders during 2011 as its nonperforming assets skyrocketed. Thanks to some inventive thinking, hard work and a bit of luck, the bank’s chief credit officer and his team were able to work through those problem assets with great success.

Another significant item was Community First Bank’s successful restructuring of its capital. In 2008, the company participated in the Trouble Asset Relief Program and issued shares of preferred stock to the U.S. Treasury. In 2014, the Treasury decided to end the TARP program and chose to sell the company’s preferred stock at auction. Through a series of transactions, the bank and its board of directors were able to purchase enough shares to enable the company to remain under local control.

During the time these events were taking place, our employees refocused their efforts to improve the customer’s experience and operational efficiency, positioning the bank to be significantly more profitable than in past years.

It has been a joy to be part of an organization that has been through a significant struggle but did not lose its focus on being a part of our community and protecting the interests of our 2,300 shareholders, the vast majority of whom make up our local community.


Jon Thompson (jthompson@cfbk.com) is president and chief financial officer of Community First Bank & Trust.