By Bob Quick | The New Mexican
Posted: Monday, May 31, 2010 -
This article was syndicated from The New Mexican, click here for the original article.
The new Charter Bank is not going out of business and is not about to be liquidated, the president of the bank said Thursday in an interview in Santa Fe.
On the contrary, the bank is anxious to lend money for both residential and commercial building.
“We’ve got so much money to lend it hurts,” said Robert Bonnet, president and chief executive officer of the new Charter Bank. “We’re one of the few banks in town that can say we have money to lend.”
The original Charter Bank, with branches in Albuquerque, Santa Fe and Rio Rancho, was closed by the Office of Thrift Supervision in late January.
Among other problems the OTS cited was that Charter failed to classify assets and establish allowances in accordance with generally accepted accounting principles and failed to properly administer commercial real estate loans. The bank also was instructed to raise additional capital.
The Federal Deposit Insurance Corp., which was appointed receiver of the bank, subsequently sold the institution to Charter Bank of Albuquerque, a newly chartered federal savings bank and a subsidiary of Beal Financial Corp. of Plano, Texas.
The new Charter Bank is a sister bank of Beal banks in Plano, Texas, and Las Vegas, Nev.
Banks often are given new names after a takeover, but that’s not the case with Charter Bank.
“We kept the Charter Bank name because we like the name, but more importantly we like the franchise — where it’s located, the range of services Charter Bank offers and the customers it attracts. We want to build on those strengths,” said Beal chief operating officer Rick Koretz, in a statement.
After the takeover, Beal Financial put $97 million in new capital into the new bank, Bonnet said, raising the total amount of Charter Bank’s capital to more than $166 million.
“That’s an 18 percent ratio,” Bonnet said. “The minimum ratio is 8 percent. That puts us in the position to lend.”
Charter Bank’s total assets are now $920.2 million, according to a call report issued for the first quarter of 2010. And the bank’s earnings in the first quarter were more than $1 million.
In other comments, Bonnet said the bank has heard from customers who bought certificates of deposit from Charter Bank at certain rates, only to have those rates adjusted downward after the new Charter Bank took over.
The FDIC required a lower rate because of the terms of the FDIC take over, Bonnet said.
The new Charter Bank offers CDs at competitive rates in an attempt to grow its deposit base, Bonnet said, but the overall state of the economy is keeping interest rates very low.
In other remarks, Bonnet said Charter Bank has no intention of closing either of its two Santa Fe branches. The two banks, one on St. Michael’s Drive, the other on Washington Avenue, employ 12 people.
At all six bank branches, there are now 120 employees, down from 200 at the original Charter Bank.
As for Santa Fe’s real-estate market, Bonnet said it is in the process of stabilizing, with a further drop in local real-estate prices unlikely.
