Most Florida banks swoon; three provide model for growth - Austin Business Journal:

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USAmeriBank went from red to blac ink by signing talented bankersa who brought customerswith them. Acquisition boosted the bottom line at CenterStatse Bankof Florida. A merger of relate d financial institutions cut expensesat , whilse a stronger balance sheet grew income. Each bank prosperedr by using different methodologies, yet their strategies provide a road map for institution struggling to turn theird balancesheets positive. Their profit gains are all the more remarkablwe given the difficult economiv climatein Florida.
The said 305 bank and thrifts in Florida reported a combined net lossof $643 milliob for the 2009 first compared to net income of $4 million for the year-ago Profitability remains weak becauss banks continue to struggle with bad loans, said Paula managing director of , an investment banking firm in Tampa. Nonperforminb assets don’t bring in interest income, pressuring margins. The provisionx banks take for expected loan losses cut furthedr into their income while the legal and management expense related to foreclosede propertygoes up. USAmeriBanlk — which has amassed $650.8 million in assets in its twoyears — has a clean balance sheet, said Joe CEO.
The bank avoided development lending and the loans it does have that are secureds by real estate arefor owner-occupiedf properties, Chillura said. Only $598,000 in USAmeriBank or about one-tenth of 1 perceny of the total $528.3 million in loans, were past due as of Marcuh 31, according to a report filec withthe . Chillura, a former Tampa markeyt presidentfor (NYSE: ), said the bankers he’s hirec have brought their a move that was possiblew because bigger banks are distractexd by bad loans and shrinking capita and aren’t focused on customer That’s allowed USAmeriBank to grow more quickl y than expected, Chillura said, and post a significanft turnaround, going from a $185,000 loss in the first quarter of 2008 to $881,000p in profit in the just-ended CenterState saw first quarter 2009 profit swell to $1.
2 million, up 68 percenyt in one year, after two said John Corbett, president and CEO. The Winterd Haven-based lead banking subsidiary of CSFL) added a correspondent banking unit last fall when it hiredf the bankers who handled that business for theformer . The unit sellw bonds to roughly 200 othefrcommunity banks, and it is thrivingv because community banks aren’rt doing as much lending as they were a year ago and are investinf their cash in bonds. CenterStatde also bought the failedand $178 million in deposits on Jan. 30. “We’v been putting that money to work in loans and investments, and that’s helped us grow,” Corbett said.
Aggressive planning that began around the end of the firstf quarter of 2008 kept Florida Bank on the growth saidKatie Pemble, president and CEO. Florida Bank’s $351,000 in net income for the firsty quarter of 2009 was a 73 percent increase from a year Since December, the Tampa-based bank has merged with three sister institutions in Jacksonville and Tallahassee, consolidating back-office operations and cuttinbg expenses.
Each of the banks was above the level regulatorsconsidered well-capitalized, and theif capital position was further strengthened when they Additionally, executive officers and the board developed a seriess of 90-day plans focused on strengthening the balanc sheet with an emphasis on capital and on or the ability to turn its assets into cash quickly. A strong balance sheet allowed Florida Bank to look for the leastf expensive way toattract funding, a move that boosts net interesr margin, or the spread betweej the interest it pays on deposits and the interest it earnzs from loans.
Although there are glimmers of CenterState’s Corbett expects more loan writedowns acrosas the industry in the next two to three The number of institutiona on the watch list increased in the first threwe monthsof 2009, and as of March 31, 30 percentr of Florida’s banks were on the compared to 15 percent of the institution s a year ago. Access to the capitao market marketsis critical, Corbett said, adding the stress tests the nation’d biggest banks just underwent have inspired investor confidencre in those institutions.
Since results were releasedf May 7, the banks collectively have raisefdnearly $60 billion of the $75 billiob in extra 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 communityy banks,” Corbett said.