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Santa Cruz County Bank reports Q2 profit up; loan commitments totaled $15 million

July 17, 2012

Santa Cruz County Bank posted a profit of $633,000 for the quarter ending June 30, up 10 percent from the prior quarter and up 18 percent from a year ago.

Loans totaled $203.4 million, growing by $3.6 million, up 2 percent from the prior quarter and up 18 percent from a year ago.

"We made $15 million in loan commitments during the quarter," said David Heald, Santa Cruz County Bank president and chief executive officer, noting the $3.6 million increase reflects loan payoffs.

Others in the region are seeing loans decline.

"Average one-year loan growth through Q1 2012 for commercial banks in our federal district with less than $1 billion in total assets was negative 1.8 percent," Heald said.

He attributed the double-digit increase in net income to loans put on the books in the first quarter and "our ability to control non-interest expenses."

He said Santa Cruz County Bank funded new loans in the second quarter for business acquisition, expansion and improvements, some to meet Americans with Disability Act compliance, with business coming from throughout the county.

Fred Caiocca, the bank's executive vice president, moved to Watsonville in the first quarter to head up lending.

Heald noted loans were made to a variety of sectors including health care, agriculture and the visitor-serving and tourism industry.

Deposits grew to $310 million, up 3 percent during the quarter and up 14 percent from a year ago. That was largely due to a 13 percent jump in non-interest-bearing deposits.

"Our second quarter deposit trend has repeated itself," Heald said. "Historically, we have experienced an accumulation of deposits in the second quarter and throughout the summer primarily due to the seasonality of visitor-serving businesses that deposit with us. June was also a particularly strong month for new account acquisition."

Assets grew to $341 million, up 5 percent during the quarter and up 14 percent from a year ago.

Shareholders' equity grew to $27.8 million, up 3 percent during the quarter and up 11 percent from a year ago.

The 8-year-old locally owned bank reported 33 cents earnings per share, up from 30 cents in the last quarter and up from 28 cents a year ago.

Non-interest income totaled $573,000, up 9 percent from the prior quarter.

The provision for loan loss totaled $300,000, unchanged from a year ago.

The Lau property on Pacific Avenue, an empty lot with an approved development plan, foreclosed by the bank is for sale, Heald said.

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