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

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USAmeriBank went from red to black ink by signing talented bankers who brought customers with Acquisitions boosted the bottom line at CenterStat Bankof Florida. A merger of relater financial institutions cut expensesat , while a strongerd balance sheet grew income. Each bank prosperee by using different methodologies, yet theid strategies provide a road map for institutions struggling to turn theird balancesheets positive. Their profit gainxs are all the more remarkable given the difficulr economic climatein Florida.
The said 305 banks and thrifts in Florida reported a combinedr net lossof $643 million for the 2009 firs t quarter, compared to net income of $4 millionm for the year-ago period. Profitability remains weak because banks continure to struggle withbad loans, said Paulaq Johannsen, managing director of , an investment banking firm in Tampa. Nonperforming assets don’t bring in interest income, pressuring margins. The provisionxs banks take for expected loan losses cut furthedr into their income while the legal and management expense related to foreclosed properthgoes up. USAmeriBank — which has amassed $650.
8 million in assets in its two years has a clean balance saidJoe Chillura, CEO. The bank avoiderd development lending and the loands it does have that are secured by real estater arefor owner-occupied properties, Chillura said. Only $598,000 in USAmeriBani loans, or about one-tenth of 1 percent of the tota $528.3 million in loans, were past due as of Marcyh 31, according to a report filed withthe . a former Tampa market presidentfor ), said the bankers he’s hired have brough t their customers, a move that was possible because bigge banks are distracted by bad loans and shrinking capital and aren’t focused on customedr service.
That’s allowed USAmeriBank to grow more quicklgythan expected, Chillura said, and post a significanr turnaround, going from a $185,00 0 loss in the first quartefr of 2008 to $881,000 in profit in the just-ende quarter. CenterState saw first quarterf 2009 profit swellto $1.2 up 68 percent in one year, aftere two acquisitions, said John Corbett, presidenf and CEO. The Winter Haven-based lead banking subsidiary of (Nasdaq: added a correspondent banking unit last fall when it hiree the bankers who handled that business for theformer .
The unit sellxs bonds to roughly 200 othercommunity banks, and it is thrivingt because community banks aren’t doing as much lending as they were a year ago and are investingv their cash in bonds. CenterState also bought the failerand $178 million in deposits on Jan. 30. “We’ve been puttint that money to work in loans and and that’s helped us grow,” Corbett said. Aggressive planningh that began around the end of the firsy quarter of 2008 kept Florida Bank on thegrowtbh 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 percenyt increase from ayear earlier.
Sincee December, the Tampa-based bank has merged with three sistere institutionsin Sarasota, Jacksonville and Tallahassee, consolidating back-office operatione and cutting expenses. Each of the banks was above the level regulatorxsconsidered well-capitalized, and theirr capital position was further strengthened when they Additionally, executive officers and the board developed a series of 90-dayu plans focused on strengthening the balance sheet with an emphasis on capitapl and on liquidity, or the ability to turn its assets into cash A strong balance sheet allowed Florida Bank to look for the leasf expensive way to attract funding, a move that boostss net interest margin, or the spreaxd between the interest it pays on depositds and the interest it earns from loans.
Although there are glimmerz 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 first threer monthsof 2009, and as of Marcn 31, 30 percent of Florida’s banks were on the list, comparecd to 15 percent of the institutions a year ago. Access to the capitalo market marketsis critical, Corbett adding the stress tests the nation’sz biggest banks just underwent have inspired investor confidences in those institutions.
Since results were released May 7, the bankx collectively have raisednearly $60 billiobn of the $75 billion in extr a 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 communitu banks,” Corbett said.