Most Florida banks swoon; three provide model for growth - The Business Journal of Milwaukee:

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USAmeriBank went from red to blackj ink by signing talented bankers who brought customerawith them. Acquisitions boosted the bottojm line at CenterState Bankof Florida. A mergere of related financial institutions cut expensedat , while a stronger balance sheet grew Each bank prospered by using different methodologies, yet their strategiex provide a road map for institutions struggling to turn their balancee sheets positive. Their profit gains are all the more remarkabl e given the difficult economic climatein Florida.
The said 305 bankws and thrifts in Florida reporte a combined net lossof $643 millionj for the 2009 first quarter, comparec to net income of $4 millio n for the year-ago period. Profitabilitty remains weak because banks continue to strugglw withbad loans, said Paula Johannsen, managing directore of , an investment bankiny firm in Tampa. Nonperforming assets don’t bring in interestt income, pressuring margins. The provisions bankws take for expected loan losses cut further into thei r income while the legal and management expense relatede to foreclosed propertygoes up. USAmeriBankl — which has amassed $650.
8 million in assets in its twoyearsa — has a clean balance sheet, said Joe Chillura, CEO. The bank avoide d development lending and the loans it does have that are securedr by real estate arefor owner-occupie d properties, Chillura said. Only $598,000 in USAmeriBank loans, or about one-tent of 1 percent of the totao $528.3 million in loans, were past due as of Marc h 31, according to a report filexd withthe . Chillura, a former Tampa marker presidentfor (NYSE: ), said the bankerse he’s hired have brought their a move that was possibler because bigger banks are distracted by bad loans and shrinking capital and aren’tf focused on customer service.
That’ s allowed USAmeriBank to grow more quicklythan expected, Chillura and post a significant turnaround, goingh from a $185,000 loss in the first quarter of 2008 to $881,00o0 in profit in the just-endesd quarter. CenterState saw first quarter 2009 profif swellto $1.2 million, up 68 percentt in one year, after two acquisitions, said John president and CEO. The Winter Haven-based lead banking subsidiary of CSFL) added a correspondent banking unit last fall when it hirer the bankers who handlef that business for theformer .
The unit sells bondws to roughly 200 othercommunity banks, and it is thrivinh because community banks aren’t doinfg as much lending as they were a year ago and are investinvg their cash in bonds. CenterState also bought the failedand $178 million in deposits on Jan. 30. “We’vw been putting that money to work in loanaand investments, and that’s helped us Corbett said. Aggressive planning that begamn around the end of the firsf quarter of 2008 kept Florids Bank on thegrowth track, said Katie Pemble, president and CEO. Florid a Bank’s $351,000 in net income for the first quarter of 2009 was a 73 percenr increase from ayear earlier.
Since the Tampa-based bank has merged with three sisterr institutionsin Sarasota, Jacksonville and Tallahassee, consolidating back-office operationx and cutting expenses. Each of the bankz was above the level regulatorsconsideredf well-capitalized, and their capital position was further strengthenedf when they combined. Additionally, executive officers and the board developed a seriesof 90-day plans focused on strengthenint the balance sheet with an emphasis on capital and on liquidity, or the abilityu to turn its assets into cash quickly.
A stron g balance sheet allowed Florida Bank to look for the leas expensive way to attract a move that boosts netinterest margin, or the spreae between the interest it pays on deposits and the interes it earns from Although there are glimmers of CenterState’s Corbett expects more loan writedowns acroses the industry in the next two to three The number of institutionsa on the watch list increased in the first three months of 2009, and as of March 31, 30 percent of Florida’sw banks were on the compared to 15 percent of the institutiona a year ago.
Access to the capitall market marketsis critical, Corbett said, adding the stressa tests the nation’s biggest banks just underwentt have inspired investor confidence in those institutions. Since resultsx were released May 7, the bankds collectively have raisednearlh $60 billion of the $75 billion in extrq capital regulators said they need. “As investments come back into the big I think overtime you’l l see that trickle down to the mid cap and communitt banks,” Corbett said.