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
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MissionIR is committed to connecting the investment community with companies that have great potential and a strong dedication to building shareholder value. We know our reputation is based on the integrity of our clients and go to great lengths to ensure the companies represented adhere to sound business practices.
Sign up for “The Mission Report” at www.MissionIR.com
Please see disclaimer on the MissionIR website http://www.missionir.com/disclaimer.html
