With its core holding being wholly-owned, Florida-chartered commercial bank OptimumBank, OptimumBank Holdings, Inc. (NASDAQ: OPHC) is one of the able-bodied survivors of the 2008 to 2013 wave of bank failures across Florida, which left the state’s banking sector primed for M&A after 110 banks were shuttered, bringing the total number of banks in the state down to just 204. Undaunted and now refocused for success, fully FDIC-insured OptimumBank is currently gearing up for a strong 2015 in their core business of providing various commercial banking services to corporations and individuals. Via the bank’s three offices strategically located throughout southeastern Florida’s Broward County (Deerfield Beach, Ft. Lauderdale and Plantation), OptimumBank is leaning into the curve as the local economy continues to show signs of increased vigor, a trend which began back in 2013 and continues to this day.
For instance, BLS data on Florida shows that household incomes climbed 6 percent over the two years leading up to late 2014, beating the national average by one percent, even as the state’s GDP continued to climb upwards from the 2.2 percent growth seen in 2013, posting a nominal GDP increase of $71.9 billion for Q1 2014. This was in line with Governor Rick Scott’s ambitious projections in his 7 steps to creating 700k jobs over 7 years plan and the state has indeed managed to add over 594k jobs since Scott took office in 2011, with personal incomes up 13 percent between 2010 and 2014, to around $835 billion. In fact, Florida recently ranked number six on Business Insider’s list of the fastest growing state economies, with the housing market rebound in particular showing continued strength, as prices rose 8.9 percent from Q1 2013 to Q1 2014, even as job force growth outpaced the national average handsomely by nearly a factor of two, amid a 3.1 percent jump in payroll jobs between June 2013 and June 2014.
This is crucial background economic performance data showcasing the lay of the land for a company like OptimumBank, which is invested in accepting deposits, making business loans, and offering basic investment products to businesses and individuals throughout southern Florida. OPHC’s other wholly-owned subsidiaries, OB Real Estate Management, OB RE Holdings and OB RE Holding, round out a revenue footprint based on deposits, principal and loan repayments, and investment security sales, with proceeds from holding and selling foreclosed real estate. OptimumBank’s total assets were up roughly 3.7 percent to $129.1 million as of late March this year, compared to the end of 2014, on a solid uptick in net loans of around $3.6 million, combined with an increase of some $0.7 million in cash. Stockholders’ equity was also up $0.1 million YOY to $3.1 million as of March 31, 2015, and OptimumBank is clearly capitalizing on groundwork laid out in 2013, with strong 2014 performance that has been underscored by a solid Q1 this year.
Having clocked in a straight run now of 12 consecutive months of healthy profitability, coming out of Q4 2014 exhibiting a Tier 1 capital leverage ratio of 7.67% on an increase of $664k, to a total of $9.15 million, the company is poised to deliver a banner year, with an attractive profitability margin of approximately 34 percent. Significant investment into developing regional alliances and improving their overall loan production capabilities, combined with an enhanced focus on marketing and getting involved in local community events, has primed OptimumBank for explosive growth, and the company has implemented several customer acquisition and retention features to heighten this momentum as well, including Affinity Rewards programs for NPOs (nonprofit organizations) and mobile deposit capture (remote deposit) for their clients.
Deposits are the primary source of income for OptimumBank and the company has aggressively set forth a plan to attract and increase overall retention. A plan which is spearheaded by a policy of adjusting rates on the fly in accordance with this objective, and management is confident that they will be able to acquire and retain deposits readily through a mix of rate adjustments and loyalty-inspiring service offerings. Moreover, the company’s approach to loan management has evolved over the years into a circumspect grid that allows them to maintain a high degree of profitability from this end of the business. A sophisticated loan portfolio management strategy, which is divided into six distinct segments, each with their own risk assessment protocols and characteristics, spanning residential and multi-family real estate, as well as commercial real estate, land and construction loans, allows the company to meticulously analyze intended use and viability on a property-by-property basis.
OptimumBank looks to be one of the strongest players in the region if you drill down into the balance sheet further, with a 157 percent increase in Q4 2014 book value per share to $0.85, as the company raked in some $5 million on the strength of earnings and projected core future earnings, which led to a $4.8 million one-time Deferred Tax Asset earnings adjustment. Projections are that the same ability to capitalize on plans laid out in 2013 by CEO Tim Terry and his management team, which were seen so strikingly in last year’s performance metrics, will be met or surpassed this year. The company’s Ft. Lauderdale corporate offices are apparently buzzing with excitement too, as the significantly increased emphasis on training and employee development which began in 2013 further come to fruition and the company readies itself for mounting performance growth.
Ready to serve the growing Floridian economy with a wealth of commercial real estate lending services, working capital credit lines and structured loans, as well as the relationships-based business banking products and cash management services needed to fully round out the equation, OptimumBank prides itself on being a trusted regional source of banking expertise for businesses to rely on. Capable of providing experienced professionals who really understand the local economy and are familiar with the community, OptimumBank covers all the bases for its clientele, from full-spectrum cash management services and commercial checking, to business money market accounts. This same level of relationships-based professionalism extends into the bank’s personal banking offerings, with highly competitive interest rates and comprehensive CD services that offer a wide variety of ways to deposit and withdraw funds, transfer funds in real-time between accounts, and pay bills or bank online.
Take a closer look by visiting www.optimumbank.com
