FirstBank’s Founder and Chairman Jim Ayers Talks “Family, Legacy, Employees” in Nashville Business Journal

The following feature appeared as the cover story of the December 9, 2016, edition of the Nashville Business Journal. Written by Meg Garner. Read the online version here.

Nathan Morgan, Nashville Business Journal

Nathan Morgan, Nashville Business Journal

When Jim Ayers opened the first location of FirstBank in Lexington, Tenn., in 1988, it was the first time a bank had opened in the West Tennessee town in years. It drew such interest that state troopers had to help control the crowds, as folks flooded the community’s main thoroughfare to catch a glimpse of the new bank. At the end of that first day, Ayers sat in one of the bank’s back offices with his feet on the desk and told himself that his venture into banking was going to be good.

More than $3.2 billion in assets, $2.6 billion in deposits and 28 years later, FirstBank is the state’s eighth-largest bank, according to federal data. But now, at the age of 72, Ayers was faced with the one decision no business owner wants to make: What happens to his company when he can no longer steer the ship?

“If I had my preference, I’d never retire and keep doing exactly what I’m doing until I’m 90 or 100 years old,” Ayers said from FirstBank’s downtown Nashville offices.

But as FirstBank’s sole shareholder, Ayers had to make a contingency plan for when he could no longer run the bank. And since he owned the bank outright, Ayers felt he only had three viable options: pass the business to an heir, sell the bank or go public.

The answer came in September, when Ayers rang the bell at the New York Stock Exchange. That day he relinquished 30 percent of his control, and the Nashville-based lender brought home $115 million in new capital, making its initial public offering the largest bank IPO in Tennessee history.

The road to FirstBank’s IPO was not a short one. In fact, it took Ayers nearly five years to execute.

Weighing his options

Before consulting his estate planners or attorneys, Ayers asked his son, Jon, the loaded question: Would he take the reins at FirstBank?

For Ayers, having his son take over his role at the bank was a simple solution to his estate planning, partly because it meant FirstBank would remain a family-owned business.

Unlike his father, Jon Ayers, 44, began his career in banking. The younger Ayers has run branches, worked in FirstBank’s credit department and serves on the bank’s board of directors. He was the ideal candidate in his father’s eyes.

But Jon Ayers, who declined to comment for this story, turned his father down in favor of spearheading the family’s commercial real estate investments under Ayers Asset Management.

“He wanted to be known for running his own business, and I didn’t fight him on it,” Jim Ayers said.

Still, his son’s refusal to run the business he built was difficult for Ayers, especially since the elder Ayers had once begged his own father to take over his family’s saw mill in Parsons, Tenn., only to be rebuffed.

“[My father] said he was not going to see me work the rest of my life like he had to work, so I was going to go ahead and get an education,” Jim Ayers said.

With his hopes of passing FirstBank to an heir off the table, Ayers was left with two options, one of which would involve surrendering complete control of the business he spent 30 years building.

Selling FirstBank was a nonstarter for Ayers, and not because he was unwilling to give up the corner office.

Ayers felt he owed more to his employees, who had invested in making FirstBank the company it is today.

“I could sell this bank, and do it pretty quick. They’d be lining up at the door,” he said.

“But the idea of selling this bank and half the employees losing their jobs, I couldn’t do it, and I didn’t have to  do it. … I am not going to preside over a huge layoff.”

It was not the first time he made a move he thought was best for his employees. In the mid-1990s, he divested his stake in American Health Centers, the nursing home business he founded, by initiating an employee stockownership plan. But Ayers said such plans, which turn over control of a business to employees, do not work as well today, so converting FirstBank into one was never a viable option in his mind.

That left one choice. So Ayers and his team, led in large part by the bank’s CEO Chris Holmes, began the process of filing for an IPO — a decision that sett off another year and a half of planning.

Learning a new game

Ayers said when he told his board members of his plans, they told him he was signing himself up for a “new lifestyle,” especially since the bank’s regulatory scrutiny would increase and the independent Ayers would have to answer to fellow shareholders.

During the IPO planning, Ayers relied heavily on Holmes to help him understand what changes to expect.

“Ninety-eight to 99 percent of what goes on, goes on without me,” Ayers said. “Chris Holmes is very capable of running this bank. My value is on the strategic side.”

Ayers said he hired Holmes in 2010 as the bank’s director of operations to see if the fellow University of Memphis alumnus could cut it as the bank’s CEO. Since then, Ayers said his recruit has proven himself time and again, particularly now since Holmes has experience managing a publicly traded company.

“It’s probably the only thing that I have more experience than him with,” said Holmes, who was CEO of National Commerce Financial Corp. in Memphis and chief retail banking officer for the South Financial Group in Greenville, S.C. “For a while, working with him on [the IPO] became the majority part of my schedule.”

Holmes said after spending hours talking through the new rules, it was clear that Ayers would be able to adapt.

“It might take me some time, but I can learn the rules,” Ayers said.

Following the bank’s public offering, Ayers controls about 70 percent of FirstBank. So while he gave up a portion of the company’s shares, he maintains a controlling stake in FirstBank — which means he still has the final word on the bank’s big decisions.

But for Ayers, the most difficult part of taking his bank public is having a fiscal responsibility to others. The financial impact that a strong quarter versus a weak quarter can have on the company’s share price weighs on Ayers.

It’s no longer just about his own pocketbook. He’s now responsible for other shareholders’ money.

‘Right thing to do’

It was Ayers’ fellow FirstBank board member and longtime friend Gordon Inman who helped the bank’s management team convince Ayers that going public was the right decision, when the bank chief questioned whether the process was worth it.

“I just kept saying, ‘Jim, this is the right thing for you to do, for your family and for your loyal employees,’” Inman said. “I just kept pounding that into him, and it finally soaked in.”

Like Holmes, Inman said Ayers struggled with the implications of having fellow shareholders and how it would change his day-to-day routine.

He also wanted to make sure he took care of the most important shareholders: his employees. Ayers awarded each of FirstBank’s employees a certain number of shares, based on their salary and years of service.

As for his own retirement plans, Ayers hopes to spend the next three to five years, or as long as his health allows, right where he is now, running the bank. Ayers said physically his body is strong, but acknowledged he suffers from vision and hearing loss, which is why his employees are more likely to find him meeting at the small, round table in his office rather than the board room.

It is at that same small table that Ayers laid out what he hopes his legacy will be once he walks away from the business he spent three decades building.

“I’ve got a grandson, Jay, and 20 years from now, if he’s walking down the street and somebody says, ‘Are you related to Jim Ayers?’ He’ll say yes, and I hope that fella says to him, ‘He was a good man,’” Ayers said. “Not a wealthy man, a smart man or a powerful man. Just a good man.”


October 1984: Jim Ayers and Steve White buy Scotts Hill, Tenn.-based Farmers State Bank, which had $14 million in assets.

July 1988: Ayers buys the National Bank of Lexington, merging with Farmers State and buying out White. Ayers becomes the bank’s sole shareholder, moves its headquarters to Lexington, Tenn., and changes its name to First Bank.

February 1996: Ayers completes the acquisition of the Bank of West Tennessee in Jackson, Tenn. He also buys a NationsBank branch in Camden, Tenn., this year.

August 2000: Ayers acquires Bank of Huntingdon, another small West Tennessee bank.

November 2001: First Bank opens its first Nashville office, which becomes the bank’s first metro market. FirstBank opens its first Memphis branch this year, too.

June 2003: First Bank completes a $26.8 million acquisition of Rutherford County’s Bank of Murfreesboro. Following the deal, First Bank passes $1 billion in total assets.

November 2006: First Bank buys seven branches from AmSouth Bank, bringing First Bank’s total assets to nearly $2 billion.

November 2007: First Bank announces plans to open 12 branches in five years and enter six new Middle Tennessee markets.

February 2010: Chris Holmes joins First Bank as its chief banking officer.

January 2013: Holmes becomes First Bank’s CEO, after becoming president in April 2012.

March 2014: First Bank announces its first full-service branch in Huntsville, Ala., combining operations with its existing mortgage business.

February 2015: The bank officially registers its name as FirstBank.

May 2015: Ayers buys Ringgold, Ga.-based Northwest Georgia Bank, boosting the bank’s presence in neighboring Chattanooga. FirstBank officially moves its headquarters to Nashville.

August 2016: Ayers files paperwork for FirstBank’s initial public offering.

September 2016: FirstBank debuts on the New York Stock Exchange, pricing above expectations and raising $128 million.