A bank can get bigger and become less certain of what it is. Atlantic Capital Bank discovered this after buying First Security Group in 2015. The Atlanta lender acquired a community bank in Tennessee, a network of branches, and an awkward question: how much of this new business actually belonged together?
- The original idea: experienced bankers serving businesses, their owners and commercial property clients.
- The detour: a regional acquisition followed by the sale of 14 remaining branches in 2019.
- The next chapter: national payments relationships and a 2022 merger into SouthState.
The useful part of the story is the reversal. Businesses tend to advertise acquisitions and hurry past divestitures. Here, the sale helps explain what the bank was good at. A smaller map made the proposition easier to see.
One office. A very particular customer.
Atlantic Capital opened in 2007 with $125 million in equity capital. Its early proposition put experienced corporate bankers within reach of businesses that wanted a closer relationship with their lender. By the 2015 acquisition announcement, it had approximately $1.3 billion in assets and a single office.
Its customers included privately held companies, nonprofits, selected real estate developers and investors, and affluent individuals. The owner of a business could also be a private-banking customer. That overlap mattered: knowing the enterprise could help a banker understand the person behind it.
The work was practical. Businesses needed financing and a place to hold operating cash. Treasury services helped them collect receipts and make payments. Developers needed bankers who understood projects and collateral. The competitive claim was access to larger-bank expertise with the attention of a smaller institution. Its edge depended on the people delivering that combination.
The map got bigger. The job got muddier.
The First Security agreement was announced at approximately $160 million. It brought Atlantic Capital into Tennessee and north Georgia, and the combination accompanied a public listing. First Security offered retail banking, mortgages, trust services and financial planning. There was considerably more to manage than another book of commercial loans.
Williams later explained that private-equity shareholders wanted public-market liquidity. The transaction helped provide it. But the acquired community bank served different markets through a different operating model. By late 2016 and 2017, he recalled, employees were unclear about the bank’s direction.
“Our people were confused.”
Doug Williams, The Purposeful Banker
That was an early warning. Management attention was being pulled toward a turnaround while opportunities remained in Atlanta. In his later assessment, Williams said he probably would not have made the acquisition knowing what he subsequently learned.
Fourteen branches, handed back
Effective April 5, 2019, FirstBank took over the remaining 14 Tennessee and northwest Georgia branches, including the mortgage business. It assumed approximately $598 million in deposits and purchased about $385 million in loans. Atlantic Capital had already sold other acquired locations.
The mechanics deserve a pause. A bank deposit is a liability: the bank owes that money to its customer. Transferring more deposits than assets therefore required Atlantic Capital to send cash with the business. Its annual report put that closing cash payment at approximately $167 million. That payment was part of settling the transferred balance sheet, not a simple measure of an acquisition loss.
Different sides of the balance sheet. Figures are approximate.
The cultural repair began before the sale. Consultant Lisa McLeod worked with employees on a clearer customer purpose. Reviews began to recognize referrals and information shared across departments. The phrase was “We fuel prosperity.” Its practical test was whether colleagues worked together to help the same customer.
The customer beyond the branch
A different kind of distribution was taking shape. In February 2019, Atlantic Capital announced a partnership with Self Lender, the credit-building fintech now known as Self. The bank supplied banking support for credit-builder accounts delivered to consumers across the United States.
For a consumer, the visible relationship could be with a financial app. Behind it sat a bank with the operational expertise and processing capacity to support the product. Atlantic Capital could reach beyond its local market without opening a branch for every new community of users.
This also explains its interest in payments companies. Moving money for a business can create an ongoing relationship involving deposits, processing and fees. The bank earned interest income from lending and securities, alongside service charges and other noninterest income. SBA lending and franchise finance added specialist business lines. These were connected ways of serving commercial customers.
Even the paperwork had to grow up
Specialization did not remove the back-office chores. Atlantic Capital used stock awards to attract and retain employees, but originally administered them with spreadsheets and paper. Growth and public-company reporting made that arrangement harder to defend.
It adopted Certent Equity Management to handle awards and reporting. Employees could review and accept awards through a portal. In the vendor’s case study, risk analytics executive Shannon Morrison said continuing with spreadsheets would have required another employee. A bank selling operational competence to clients had its own operational bottleneck to fix.
The second merger had a clearer purpose
SouthState’s July 2021 announcement described an Atlantic Capital with two branches, approximately $3.8 billion in assets and $3.3 billion in deposits. The all-stock transaction was then valued at about $542 million. SouthState subsequently reported a $657.8 million accounting purchase price. With stock consideration, the announcement value and acquisition-date measurement need not match.
Williams described the attraction of a larger capital base and broader capabilities. SouthState wanted Atlanta scale and Atlantic Capital’s corporate, fintech and payments expertise. Both banks already used the same core banking and treasury platforms. That offered a concrete point of compatibility after the earlier experience of combining different operating models.
The merger was completed in March 2022, and systems conversion followed in July. SouthState announced Williams’s retirement in 2024. Anyone seeking the bank’s services today goes to the successor institution.
The transferable lesson is a question to ask before buying: will the added business deepen what customers already value, or consume the people who deliver it? A narrow banking model needs customers who value specialist expertise, reliable operations and enough capital to support their growth. Atlantic Capital eventually sought that capital inside a larger bank. The name disappeared; the capabilities had somewhere to go.