March 20, 2018


Florida banks have room to breathe

International money and a comeback in the housing market are lifting Florida banks. Problem loans are receding.

Mike Vogel | 10/1/2013

Ritchie says his bank likely will raise more capital through a private placement this year.

With the dynamic of too-small-to-thrive in doubt, so is the future pace of consolidation among banks here. The number of Florida banks, which stood at 307 in 2008, fell to 221 last year and now is down to 203. That number will fall with July's announcement that Weston-based consolidator Florida Community Bank, a unit of a private equity firm, will buy $1 billion-in-assets Great Florida Bank based in Miami Lakes. Florida Community, which acquired eight banks previously, agreed to pay $3.24 per share for the troubled bank, a premium over Great Florida's pink-sheet trading price of 32 cents per share but still at a 15% discount to book value.

The level of consolidation going forward depends on how would-be buyers and sellers resolve conflicting calculations about the wisdom of deals.

Executives and shareholders at institutions that scraped through aren't eager to give up their independence. And "banks that are healthy want to get bigger, but they're not eager to jump into someone else's problems," says Brown. "You're going to have more consolidation. I'm still not convinced you will see a large wholesale consolidation."

Credit Troubles

The "Texas ratio" is a measure of a bank's credit troubles — the higher the ratio, the more severe the troubles. The term was coined by analysts who found a correlation between it and Texas banks that failed in the 1980s. (After 2008, it just as easily could have been called the Georgia or Florida ratio.) The statistic, which tends to overpredict bank failures, is calculated by dividing the value of the lender's non-performing assets (non-performing loans plus real estate owned) by the sum of its tangible common equity capital and loan-loss reserves. The ratio is considered unhealthy if it's over 100%. Here are the Florida banks whose Texas ratios were the highest in Florida at the end of the first quarter.

Bank Location Assets (millions, except where noted) Texas Ratio
Anchor Commercial Bank Juno Beach $106.47 343.93%
Bank of Commerce Sarasota 224.15 215.64
Bank of Jackson County Graceville 26.22 266.22
Beach Community Bank Fort Walton Beach 587.16 468.39
Chipola Community Bank* Marianna 37.47 340.07
Everbank Jacksonville 18.31 B 126.67
Fidelity Bank of Florida, National Association Merritt Island 299.60 107.73
First City Bank of Florida Fort Walton Beach 256.33 518.47
First Community Bank of Southwest Florida* Fort Myers 265.74 417.65
First National Bank of Crestview Crestview 97.25 299.48
Friends Bank New Smyrna Beach 109.71 153.28
Great Florida Bank Coral Gables 1.14 B 211.07
Gulf Coast Community Bank Pensacola 178.07 329.52
Heritage Bank of North Florida* Orange Park 103.96 1,064.76
Highlands Independent Bank Sebring 253.68 101.75
Home Federal Bank of Hollywood Hallandale Beach 59.44 148.96
Independent Bankers Bank of Florida Lake Mary 229.45 205.46
Legacy Bank of Florida Boca Raton 254.65 137.01
Optimum Bank Plantation 135.71 211.48
Pinnacle Bank Orange City 169.64 138.17
Southern Commerce Bank, National Association Tampa 79.98 101.84
TransCapital Bank Sunrise 198.82 182.05
U.S. Century Bank Doral 950.67 150.66

Tags: Banking & Finance, The Money Issue

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