Seacoast Commerce Banc Holdings, parent company of Seacoast Commerce Bank, plans to decrease its sales of Small Business Administration loans, a move that will reduce earnings but set the stage for greater long-term shareholder value, the company said Wednesday.
“In light of improving economic conditions, anticipated additional interest rate increases, corporate tax reform, and less regulatory burden, the Company believes it is in the best long-term interests of shareholders to hold more loans in the portfolio,” the bank said in a prepared statement.
Over time, cumulative net interest income on the loans that would have been sold will outweigh the one-time gain the company would have recorded by selling them, the bank said.
“At the end of day, our efforts are focused on increasing our long-term core franchise value, not on short-term gains,” president and CEO Richard Sanborn said.
Seacoast also declared a dividend of 8 cents per share, a 60 percent increase over its previously announced dividend of 5 cents per share, which was paid out in September.
The banks plans to send the dividend to holders of its common stock on March 20. Recipients must be shareholders of record at the close of business on March 8.
Seacoast has full-service banking branches in San Diego and Chula Vista and production offices in California, Arizona, Colorado, Nevada, Oregon, Texas and Washington states.
