The pending sale of Parkway Bankshares Inc. of Portland (Ashley County) will end an 11-year struggle to make profitable inroads in northwest Arkansas.
Benton County presented an opportunity to diversify from its southeast Arkansas base and tap into the booming real estate market.
But instead of adding to the bottom line, the foray contributed heavily to a net loss of more than $4 million since the Parkway Bank venture ramped up for northwest Arkansas during 2004.
Jerry Carmichael, a former Arvest Bank exec in Rogers, was tapped to lead the Benton County push early that year.
Built on the 1900 charter of Portland Bank, the lender was renamed Parkway Bank in May 2004, and a headquarters move to Rogers followed six months later.
Parkway raised $5.8 million in new capital to fund its northwest Arkansas effort.
The expansion began by wading into the market with a loan production office in Bentonville during the summer of 2004.
In 2006, total assets reached a year-end peak of $165 million, and payroll topped out at 78 staffers. That year began a run of four consecutive annual losses for Parkway.
The biggest loss, $4.6 million, hit in 2009.
In August 2008, Parkway Bank was sanctioned by federal regulators for unsafe and unsound bank practices.
The consent order with the Federal Deposit Insurance Corp. noted that the bank operated “with management whose policies and practices are detrimental to the bank and jeopardize the safety of its deposits.”
Carmichael was gone by mid-March 2007 along with his executive cadre of three former Arvest bankers who helped establish the northwest Arkansas operations.
The departure of his successor, Brad Collier, was followed by the 2009 exodus of Jerry Sadler as chairman and CEO of Parkway Bank. A branch in Rogers and one in Bentonville were closed that year, leaving Parkway with a single northwest Arkansas location in Rogers.
2009 is also the year Bob Taylor left Chambers Bank of North Arkansas in Fayetteville to become president and CEO of Parkway.
Taylor, current president of the Arkansas Bankers Association, will stay aboard as regional CEO and executive credit officer after the sale is completed with Citizens Bancshares of Batesville Inc., parent company of the $575 million-asset Citizens Bank of Batesville.
Parkway Bank was on its way to recording a sixth consecutive year of annual profits in 2015. But the combined tally of profits since 2010 couldn’t negate losses of 2006-09 at the $133 million-asset bank.