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

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USAmeriBank went from red to black ink by signinbg talented bankers who brought customerswith them. Acquisitionas boosted the bottom line at CenterState Bank of A merger of related financiak institutions cut expensesat , while a strongee balance sheet grew income. Each bank prospered by usinfg different methodologies, yet their strategies provide a road map for institutions strugglint to turn their balancesheets positive. Theifr profit gains are all the more remarkable given the difficult economic climatein Florida.
The said 305 banks and thriftse in Florida reported a combined net lossof $643 million for the 2009 firsyt quarter, compared to net income of $4 milliom for the year-ago Profitability remains weak because banks continue to struggles with bad loans, said Paula Johannsen, managing director of , an investmenr banking firm in Tampa. Nonperforming assets don’f bring in interest income, pressuring margins. The provisionss banks take for expectecd loan losses cut further into their income while the legaol and management expense related to foreclosecd propertygoes up. USAmeriBank — which has amassed $650.
million in assets in its two years — has a clea n balance sheet, said Joe Chillura, CEO. The bank avoidee development lending and the loans it does have that are secured by real estater arefor owner-occupied properties, Chillura Only $598,000 in USAmeriBano loans, or about one-tenth of 1 percenrt of the total $528.3 million in loans, were past due as of Marcu 31, according to a report filed with the .
a former Tampa market presidentfor ), said the bankers he’sa hired have brought their customers, a move that was possible becaus bigger banks are distractede by bad loans and shrinking capitalo and aren’t focused on customer That’s allowed USAmeriBank to grow more quicklyg than expected, Chillura and post a significant turnaround, goinv from a $185,000 loss in the first quarter of 2008 to $881,00 0 in profit in the just-endedr quarter. CenterState saw first quarter 2009 profit swelolto $1.2 million, up 68 percent in one year, after two said John Corbett, president and CEO.
The Winterf Haven-based lead banking subsidiary of (Nasdaq: CSFL) added a correspondentf banking unit last fall when it hired the bankerse who handled that business for theformer . The unit sellsa bonds to roughly 200 othercommunity banks, and it is thrivint because community banks aren’t doing as much lending as they were a year ago and are investinf their cash in bonds. CenterState also bought the failesand $178 million in depositz on Jan. 30.
“We’ve been puttinbg that money to work in loans and and that’s helped us grow,” Corbett Aggressive planning that began around the end of the firsf quarter of 2008 kept Florida Bank on the growth track, said Katiee Pemble, president and CEO. Florida Bank’s $351,000 in net incomre for the first quarter of 2009 was a 73 percent increasw from ayear earlier. Since the Tampa-based bank has merged with three sister institutions in Jacksonvilleand Tallahassee, consolidating back-office operations and cuttinvg expenses. Each of the banks was above the leveo regulatorsconsidered well-capitalized, and their capital positionj was further strengthened when they combined.
Additionally, executiv e officers and the board developed a seriedsof 90-day plans focused on strengthening the balance sheet with an emphasisa on capital and on liquidity, or the ability to turn its assetx into cash quickly. A strongg balance sheet allowed Florida Bank to look for the leas expensive way to attract a move that boosts netinterest margin, or the spreadr between the interest it pays on depositsx and the interest it earns from loans. Althoughj there are glimmers of hope, CenterState’s Corbettr expects more loan writedowns acrosd the industry in the next two tothrere quarters.
The number of institutions on the watchn list increased in the firsgt three monthsof 2009, and as of March 31, 30 percent of Florida’s banks were on the compared to 15 percent of the institutionx a year ago. Acces s to the capital market marketsis critical, Corbetr said, adding the stress tests the nation’ds biggest banks just underweng have inspired investor confidence in thosew institutions.
Since results were released May 7, the banks collectivel have raisednearly $60 billion of the $75 billio n in extra capital regulators said they “As investments come back into the big banks, I thinm over time you’ll see that trickl down to the mid cap and communitgy banks,” Corbett said.