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Monday, Sep 26, 2022

Seacoast Does Some Big Business With Small-Business Loans

Seacoast Commerce Bank was one of the smallest community banks that received TARP funding in 2008, and is still holding it despite the fact that it turned a profit and appears to have weathered the downturn.

For the fourth quarter, the Chula Vista bank reported a net profit of $1.3 million, compared with a net loss of $2.6 million in the fourth quarter of 2009.

For the full year, SCB reported an unaudited net profit of $329,000 compared with a net loss of $4.9 million for 2009.

Excepting one startup lender Vibra Bank, few banks matched Seacoast in growth last year. Its loan portfolio increased 43 percent over the year to $109 million, while assets increased 25 percent to $130 million.

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A stronger capital base certainly has a lot to do with the bank’s expansion. Besides the TARP money it got, the bank also completed a private stock placement in June for $5 million.

At the end of December, SCB’s shareholders equity stood at $13.4 million, up 61 percent from the prior year. That bolstered its capital ratios to far better than average proportions, with Tier 1 capital at 10.51 percent and total risk-based capital at 17.88 percent. Ten percent in the latter metric is considered “well-capitalized.”

Virtually all of SCB’s new loans are guaranteed by the Small Business Administration. It originated $36 million in SBA loans in the fourth quarter, and nearly $100 million for the year. It has $49 million more in its pipeline, meaning these are approved but unfunded, or in underwriting.

While the bank has only one full service branch, it operates six loan production offices in Arizona, California, Texas, and Washington.

SCB reduced its nonaccrual loans and foreclosed real estate to $2.25 million, or 1.7 percent of total assets, compared with 4 percent in nonperforming assets held at the end of 2009.

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Coronado First Turns Profit: Coronado First Bank, founded in 2005, reported net earnings for the fourth quarter, but a net loss for 2010.

The $83 million asset bank reported a fourth quarter net profit of $31,000, compared with a net loss in the like quarter of 2009 of $728,000.

For the full year, the bank reported a net loss of $111,000, compared with a net loss of $1.74 million in 2009.

CEO Bruce Ives said he was pleased that the bank’s operating loss last year was substantially lower than 2009, and noted the bank posted net profits in three of four quarters.

Faced with decreasing its holdings in commercial real estate and cutting nonperforming loans, CFB’s total assets declined 11 percent to $83 million. Total deposits fell by the same rate to $74.7 million, although its core deposits rose to 73 percent from 49 percent in 2009.

Capital remains strong with total risk-based capital at 14.7 percent, above the 10 percent to be considered well-capitalized.

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From the Police Blotter: One partner in a fraudulent San Diego loan modification business was sentenced to three years probation, and ordered to pay $3,000 in fines and $7,750 in restitution to known victims, according to the San Diego City Attorney’s Office.

Bozou Hamzaviabedi, the co-owner of Fair Lender Audits, pleaded guilty to one count of acting as a real estate agent without a license in connection with illegally collecting upfront fees from distressed homeowners to modify their mortgages.

According to the City Attorney Jan Goldsmith, the defendants (another co-owner has been charged) allegedly told the borrowers they could reduce the monthly payments. The defendants didn’t have real estate licenses, and they were not attorneys, prohibiting them from accepting fees upfront for loan modifications.

The borrowers, none of whom obtained loan modifications through the company, paid $2,500 to $3,000 for the services.

Loan modification is something lenders do without charging fees. For those seeking some representation, there’s many nonprofit groups offering the service without fees.

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Small Change: HSBC Bank USA is gaining ground in San Diego, having opened three branches last year, two in the South Bay and one in San Diego to bring its total to four….San Diego Trust Bank declared a 3 percent stock dividend to be paid about April 30 to shareholders of record as of March 31…Vibra Bank earned a four-star, excellent rating from Bauer Financial, an independent rating firm…San Diego County Credit Union hosts a used car sale Feb. 26 at its headquarters office at 6545 Sequence Drive in San Diego….Among the stars at the Independent Community Bankers of America national convention here March 20-24 are Federal Reserve Bank Chairman Ben Bernanke; Elizabeth Warren, the president’s choice to lead the new Consumer Financial Protection Bureau; Shelia Bair, chairman of the Federal Deposit Insurance Corp.; and Joe Scarborough and Mika Brzenzinski, co-hosts of MSNBC’s “Morning Joe” show.


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