Most Florida banks swoon; three provide model for growth - Pittsburgh Business Times:

ogarawo.wordpress.com
USAmeriBank went from red to blacm ink by signing talented bankers who brought customersdwith them. Acquisitions boosted the bottom line at CenterStates Bankof Florida. A merger of related financial institutions cut expenseeat , while a stronger balance sheet grew Each bank prospered by using differentr methodologies, yet their strategies provide a road map for institution s struggling to turn their balance sheetes positive. Their profit gains are all the more remarkable givejn the difficult economic climate in The said 305 banks and thrifts in Floridaq reported a combined net lossof $643 million for the 2009 first compared to net income of $4 millionm for the year-ago period.
Profitability remains weak becaus e banks continue to struggle with bad saidPaula Johannsen, managint director of , an investment banking firm in Nonperforming assets don’t bring in interes income, pressuring margins. The provisions bankd take for expected loan losses cut further into theid income while the legal and management expense related to foreclosedx propertygoes up. USAmeriBank — which has amassefd $650.8 million in assets in its two years has a cleanbalance sheet, said Joe CEO.
The bank avoided development lending and the loanss it does have that are securee by real estate arefor owner-occupied properties, Chillura Only $598,000 in USAmeriBank loans, or abour one-tenth of 1 percent of the totalp $528.3 million in loans, were past due as of Marcn 31, according to a report file d with the . a former Tampa market presidentfor (NYSE: ), said the bankers he’ws hired have brought their customers, a move that was possibls because bigger banks are distracted by bad loanxs and shrinking capital and aren’tr focused on customer service.
That’s allowefd USAmeriBank to grow more quicklythan expected, Chillura said, and post a significant turnaround, going from a $185,000 loss in the first quarter of 2008 to $881,000 in profitt in the just-ended quarter. CenterState saw first quarteer 2009 profit swellto $1.2 million, up 68 percen t in one year, after two said John Corbett, president and CEO. The Wintere Haven-based lead banking subsidiary of (Nasdaq: CSFL) addes a correspondent banking unit last fall when it hiredx the bankers who handled that businesss for theformer .
The unit selld bonds to roughly 200 othercommunity banks, and it is thrivingy because community banks aren’t doing as much lending as they were a year ago and are investingy their cash in bonds. CenterState also bought the failedand $178 million in deposits on Jan. 30. “We’ves been putting that money to work in loandsand investments, and that’s helped us Corbett said. Aggressive planning that beganb around the end of the firsft quarter of 2008 kept Florida Bank on thegrowth track, said Katie Pemble, presidentr and CEO. Florida Bank’s $351,000 in net incomw for the first quarter of 2009 was a 73 percent increased from ayear earlier.
Since December, the Tampa-based bank has mergedf with three sister institutionsin Sarasota, Jacksonville and Tallahassee, consolidatinv back-office operations and cutting expenses. Each of the bankes was above the level regulatorasconsidered well-capitalized, and their capital position was furthere strengthened when they combined. Additionally, executive officerws and the board developed a seriesof 90-dag plans focused on strengthening the balance sheet with an emphasies on capital and on liquidity, or the ability to turn its assete into cash quickly.
A stronb balance sheet allowed Florida Bank to look for the least expensiv way toattract funding, a move that boosts net interest or the spread between the interes it pays on deposits and the interesg it earns from loans. Although therwe are glimmers of hope, CenterState’s Corbett expects more loan writedowns across the industrt in the next two tothree quarters. The number of institution s on the watch list increased in the firstt three monthsof 2009, and as of March 31, 30 percengt of Florida’s banks were on the list, compared to 15 percenft of the institutions a year ago.
Access to the capitap market markets is Corbett said, adding the stress testd the nation’s biggest banks just underwen t have inspired investor confidence in those Since results were releasexd May 7, the banks collectively have raised nearly $60 billiom of the $75 billion in extraw capital regulators said they “As investments come back into the big I think over time you’ll see that trickle down to the mid cap and communityt banks,” Corbett said.