Branching out

 Michael E. Golden has grown Sun American Bank by purchasing troubled banks, many of which have been ordered by bank regulators to halt growth until their finances are straightened out.

When Golden joined Sun American as president and CEO, it had just purchased a bank. With $45 million in assets and $3 million in capital, it was operating four branches and dripping red ink. Golden’s first move was to shut down one branch; he then eliminated 20 percent of the employees and reduced executive salaries by 25 percent.

Sun American, which recently changed its name from PanAmerican Bank, currently has eight branches and posted $17 million in revenue in 2004. Golden’s goal is to add 10 branches in the next three years, and several acquisitions are already in the works.

Smart Business spoke with Michael Golden about the challenges of acquisitions and the importance of listening to employees.

What are some of the challenges of acquisitions?
Probably one of the world’s greatest CEOs, Jack Welch, said changing culture is probably the most difficult thing you’re ever going to do. He’s absolutely right, because they’re used to doing things one way; they don’t want to change.

Whether it worked or not, it doesn’t make any difference. If they had a successful business, it’s even more difficult. That’s why people at the higher levels never stay or you can’t keep them. They’re not loyal to the new group; you can’t turn them around to your way of doing things.

You see if you can do it. If you can’t, you just bring on new people. The culture gradually changes as you build your organization. People start to follow it.

How do you establish that culture?
The culture is a lot of different things. The work ethic, the intensity — if they see it at the senior level, they are going to follow it, also.

If you get in at 10 a.m., you leave at 4 p.m., your people are going to do it. But if they see you thinking about the business all the time and they know that you’re intense, they take it on also. That’s sometimes the problem with culture when you’re taking someone else over. You’ll find a senior executive who is used to working 9 to 5, and no matter what you do, that’s the way he is. If they’re not going to change, they need to go their own way.

In a fast-growing business, you need people who are truly dedicated and will put in the hours. You can’t have people who are more concerned for their vacation and taking four weeks a year.

How do you attract and retain an effective management staff?
I have a group of five senior executives who help me run the bank. By taking the company public and making them owners, every one of them has stock options so they know there’s a brass ring out there.

That’s what’s good about being public: They can look at what they own every day, they can see the value of their equity going up or down with the price of the stock. They also know that because there’s a brass ring, someday that if [the bank is acquired], they will participate in a golden parachute.

The other thing is those executives have come out of some very large banks, and they’ve never had the opportunity to be heard. Now, people are listening to them because they’re not working for a bank with 500 employees or 500 executives.

They are now very much a part of what goes on every day. There’s a lot more feedback from what they do, they see more direct results, and our workers don’t see a bunch of empty suits walking around and playing politics.

The executives see the rewards of their input immediately, and that’s what’s rewarding to an individual.

How do you make sure employees are heard?
It’s no more than some baseball player who gets lost in a big organization and never gets that chance to play on the first team. If you’re playing for the Yankees or the Miami Heat, you’re so filled at the top rungs, but that doesn’t mean there aren’t a lot of superstars sitting down there.

That’s what we do. We’re giving them an opportunity, not always paying them the biggest salary, but they know they have a big monetary return, and more importantly, they are going to be heard. They can put their ideas in, they’re sitting around talking to the chairman and the CEO every day, and they’re treated on an equal level. That has absolutely worked, and I’ve pulled in some people who have turned out to be superstars.

The salaries are not what these people work for. People work for the bonuses at the end of the rainbow because they’re getting an instant reward from their ideas and their hard work. It’s not just going out the window.

HOW TO REACH: Sun American Bank, (305) 421-6800 or

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