Loading
First Florida Integrity Bank is taking the Boy Scout approach to the pandemic: always be prepared.
That’s why the bank recently put together a capital raise of $24.1 million, mostly from friends and previous bank investors. The private placement, of subordinated debt, allows the bank to raise capital levels without diluting existing shareholders, officials say in a statement.
“The bank is actually doing really well, and we had a very good quarter,” First Florida Senior Executive Vice President and Chief Credit Officer Jody Hudgins tells Coffee Talk. That quarter, ended June 30, includes a record for pre-tax income at $7.1 million, up 31.4% from $5.4 million in the 2019 second quarter. “There are no storms brewing — but you don’t look for an umbrella in the middle of a storm.”
In thinking about that umbrella, the bank is particularly watching four sectors — hospitality, travel/transportation, energy and retail — that rely heavily on consumer behavior patterns. But predicting those patterns, like it is for any business, is a complicated endeavor. “Will (the pandemic) be with us for six months, 12 months, 24 months? No one really knows,” Hudgins says. “If it lasts more than six months the bank’s earnings and assets will decline. This can be protection and insurance against that.”
Even before the capital raise, First Florida, founded in 2009, initially as First National Bank of the Gulf Coast, had been busy. It handled federal Payment Protection Program loans for nearly 1,800 customers, totaling $183 million. Also, through the end of the second quarter, according to an earnings release, it had modified $288 million in loans. About $94 million of those modifications had returned to making full contractual payments, the release states, and another $97 million were making interest payments.
With $1.9 billion in assets, the bank also boosted its provision for loan loses by $7.3 million, bringing the total allowance to $18.2 million, or 1.43% of total loans. That’s up from $9.8 million, 0.88% of total loans, through Dec 31. In citing the need to raise loan loss levels, Gary Tice, chairman and CEO of the bank’s holding company, TGR Financial, says the pandemic is “very much in the early innings. He adds, in the release, that “fiscal and monetary stimulus have deferred and dampened the full economic implications,” of the pandemic.
Your free article limit has been reached this month.
Subscribe now for unlimited digital access to our award-winning business news.
Join thousands of executives who rely on us for insights spanning Tampa Bay to Naples.
