After 60 years in banking, Lowell Wakefield, the longtime owner of First Minnesota Bank, has decided to retire.
He agreed to sell the bank, which has a sizable presence in the western suburbs and nearby towns, to CorTrust Bank of Mitchell, S.D., in a deal announced this week.
"It was not an easy decision," Wakefield, who is now in his 80s, said in an interview Thursday. "You get to the age that I am and you reflect on where you want to go personally. It's time for me to make a move."
While terms were not disclosed, the deal is the one of the largest recently in Minnesota's community banking sector, which is seeing an increasing level of churn amid the retirement of longtime owners like Wakefield, changing demands in small-town economies and rising costs associated with technology and regulation.
Wakefield began forming the company in 1981 with the purchase of First National Bank of Glencoe, a bank that was started a century earlier by two Civil War veterans. In 1984, he bought First Minnesota Bank in Hutchinson and Stewart.
Several years later, he merged the two banks and began to expand into the then fast-growing suburbs and exurbs on the west side of the metro region.
In addition to Glencoe, Hutchinson and Stewart, First Minnesota has branches in Mayer, Monticello, Minnetonka, Mound, Buffalo, Champlin, Edina and Anoka.
"I have thoroughly enjoyed working with people in the communities and all the entrepreneurs," Wakefield said. "The employees we've had over the years have been great."
He owns the bank through McLeod Bancshares, Inc., a bank holding firm in Shorewood. First Minnesota had assets of $347 million and deposits of $280 million at the end of March, according to regulatory filings.
For CorTrust, the acquisition is the biggest deal in an expansion to the Twin Cities that began 10 years ago with the purchase of a bank in Woodbury. The firm later bought banks in Blaine and Delano and added a branch in Brooklyn Park.
In South Dakota, it has 22 locations in 16 cities and towns, including Sioux Falls.
"We're not a big bank. We're not growing just to grow. We're just an old-fashioned, down-home, Main Street bank," said Jay Gikas, president of its Minnesota operations.
CorTrust is owned and led by Jack Hopkins, grandson of its founder, whom Gikas called "a true community banker." As he expanded CorTrust beyond Mitchell, Hopkins remained committed to rural communities, but the Twin Cities units have given the firm experience in suburban ones too.
"There's a mix of metro and rural with us, just as with First Minnesota," he said.
Wakefield said he believed CorTrust executives had "similar philosophies" to his own and would continue to serve First Minnesota's communities well into the future.
"I do think that community banks have a great opportunity," Wakefield said. "They're going to have to continue to grow and get larger as CorTrust is doing. There may be fewer community banks, but they may serve a broader market and bring those necessary services to business in rural areas as well as the metro areas."