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Mercantile boosts Naples bank survival
Scratch The Royal Palm Bank of Florida off the endangered-bank list.
Illinois-based parent Mercantile Bancorp provided the Naples-based bank with $11 million in capital, boosting its chances of survival through this cycle.
Royal Palm Bank has been aggressively fixing its balance sheet by shrinking the bank. As of Sept. 30, it had net loans and leases of $107 million, compared with $128 million at the same time last year. The bank posted net losses of $39 million through Sept. 30, though much of that was from non-cash goodwill impairments.
“We'll shrink some more, but we'll be open to sound opportunities,” says Ted Awerkamp, president and chief executive officer of Mercantile. Awerkamp says Mercantile's other subsidiary banks in the Midwest have performed relatively well and have allowed the company to boost the capital at Royal Palm. “You live to fight another day,” he says.
While Awerkamp is confident that Southwest Florida will eventually rebound, the region's economy is likely to continue to suffer for another year. “This thing is far from over,” he says, reflecting the widespread mood among bankers in the region.
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