Interview with: Bruce A. Ives, President and CEO - featuring: their locally headquartered and managed community bank in Coronado, CA.

Coronado First Bank (CDFB-OTC: BB)

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The demographics and the fact that they are the only community bank on the island bodes well for Coronado First Bank

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Community Banks

Coronado First Bank

801 Orange Ave., Ste. 101
Coronado, CA 92118
Phone: 619-437-1000

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Bruce A. Ives
President and CEO

Interview conducted by:
Lynn Fosse, Senior Editor
September 14, 2006

, a native San Diegan, is the President, Chief Executive Officer and director of Coronado First Bank. From 1999 to 2004, Mr. Ives served as a director and as the President and Chief Executive Officer of Cuyamaca Bank, N.A. From 1996 to 1999, Mr. Ives was Senior Vice President and Regional Manager for Scripps Bank’s North County Coastal Region. He also served as Vice President and Group and Regional Manager of the former First Interstate Bank from 1994 to 1996.

Mr. Ives is the immediate past president of the San Diego State Alumni Association. He also serves as a director with the Campanile Foundation, the Coronado Hospital Foundation and the San Diego International Sports Council.  

Company Profile:
Coronado First Bank is the only locally headquartered and managed community bank in Coronado. We plan to draw on the resources of our local shareholder base, our board of directors and an experienced management team, in the attempt to build a successful community commercial business bank in Coronado. The Bank was formed, in part, due to requests throughout the community to establish a bank headquartered in Coronado. As a community bank, we will support the deposit and credit needs of Coronado residents and support the commercial banking and cash management service needs of the small and medium-sized businesses and professionals in Coronado and in the surrounding areas within San Diego County. We will offer a range of traditional credit products, including business loans, commercial real estate loans, construction financing, loans to professionals, home equity loans/lines and consumer loans.

Our product selection and delivery systems are expected to be responsive to the needs of local consumers, businesses and business professionals, such as attorney and certified public accounts. We believe that our professional banking knowledge and the attention to the service needs of consumers and small to medium-size businesses professionals and commercial borrowers will make us unique in the local community.

CEOCFO: Mr. Ives, why is there a need for a new bank?
Mr. Ives: “The community of Coronado does not have any local community banks ever since the Bank of Coronado was acquired by First National Bank about two-and-a-half years ago. The board, and primarily the chairman, Thomas C. Stickel, who was the brains behind the operation if you will, the founder of the bank decided that the community of approximately 36,000 people with an average income of about $105 thousand dollars needed a local community bank to service their banking needs. Had this opportunity come up off the Island in San Diego, we probably would not have gone forward only because of the proliferation of community banks that have occurred over the past four or five years. However, given the fact that we are in Coronado and there are no more community banks on the island, we thought that it was a great opportunity.”

CEOCFO: Could you tell us more about the economy of Coronado?
Mr. Ives: “Coronado is a community which is comprised primarily of consumers and small businesses; it generally tends to be mom and pop type shops. The community of Coronado is an island community and there are a mix of individuals that live here year-round as well as individuals who have second homes here. There are a lot of people that live in Arizona and come here during the summer and spend half the year here and half the year in Arizona. About 36 thousand people live on the island and the majority of businesses are smaller mom and pop shops. Therefore, our loan generation consists of primarily of construction lending as well as loans to consumers, mortgage loans and business loans for businesses on the island and off the island as well.”

CEOCFO: What are customers getting at Coronado that they are not getting elsewhere?
Mr. Ives: “We set ourselves apart from the competition by the service. When you walk into the door, you are not just a number but also a name. We call everyone by name; we know our customers, we are like a family here and we treat customers like that with respect. The turnaround is very efficient. We are able to provide all of the services that a big bank can provide but in a much more service-oriented light.”

CEOCFO: How do most of your new customers come in?
Mr. Ives: “They are coming in through primarily word-of-mouth and referral. We have done some advertising in the local periodicals here on the island as well as the Business Journal and the Daily Transcript, which are off the island. We have established a reputation for fast and efficient service and being able to provide products and services that customers like that they can get at big banks but in a more service oriented fashion. We are starting to establish a reputation and word-of-mouth is starting to spread; we are getting more referral business now.”

CEOCFO: Are there services that you are not currently offering that you would like to add?
Mr. Ives: “At this point we have a full complement of services ands we are very comfortable with our service offerings. Possibly, as we get larger and grow, we might consider looking at some kind of trust services but at this point we have wide array of services and we are happy with our offerings.”

CEOCFO: Coronado provides consultive banking service and strategic delivery channels; please what do you actually do?
Mr. Ives: “For example, if you come in and apply for a loan, if for whatever reason we are not able to provide that loan, we are not going to just say sorry you don’t qualify. We are going to look for solutions for you not just turn down the loan, but there might be an alternative that we are able to provide through another source or vendor or another institution that can help you out. Therefore, we are not just going to turn you away; we will exhaust all other solutions before we say no.”

CEOCFO: How is business?
Mr. Ives: “Business is great; we are on track and on plan and we have been well received by the community. We opened in October of 2005 and as our press release said, we are up to $26 million in assets at a 24% growth rate. We are very pleased with the direction that things are going.”

CEOCFO: Do you see the need for more branches?
Mr. Ives: “With technology the way it is and being able to deliver our products and services through a wide array of vehicles such as internet banking, courier service and various other means, I do not anticipate the need to expand too far beyond where we are now. If in the future we continue to grow and bring in customers that are off the island and we see a need for that, we will look at it at that point, but our three year plan calls for us to just have just a one-branch operation.”

CEOCFO: Are you looking to get the part-time islanders as customers and how do you approach that?
Mr. Ives: “We definitely are doing that. We have some of them as customers and some of the people that live in Arizona and live here half the time, so they will maintain an account here. It is all about the service that we can provide and people want to deal with their local community bank. We have found that customers do support the local anything, whether it is a grocery store or hardware store or local bank. We have been very fortunate and we have been opening accounts for not only people who live on the island all the time but also people that live in Arizona as well as Coronado.”

CEOCFO: Will you tell us about community involvement for the bank ?
Mr. Ives: “We are very involved in our local community and we participate in many of the local events. The largest event recently was the 4th of July and we had a tent. The 4th of July parade is a very large parade here on Coronado Island and it is well known not just in San Diego, but all over California. It is one of the largest parades around. Over one hundred thousand people came to it in one day, and considering the island is 36,500 that is a significant number. We handed out water to people that were attending; we had a big tent and passed out flags. We are very participatory in community events. We sponsor events at the park such as concerts and we sponsor those events, not just monetarily but participatory as well; everyone gets involved.”

CEOCFO: Why should potential investors be interested and put Coronado first on their radar screen?
Mr. Ives: “I think if you look at the opportunity that we have on the island and the fact that we are the only community bank on the island, the demographic on the island bodes well for the success of the community bank. It is not only being on the island but the connections that my staff and I have off the island. Having been in banking for over 18 years in San Diego, and having been born and raised in San Diego, I think the bank has a great opportunity to grow its core base, its customer base and become profitable sooner rather than later. If you look at the community banking environment and landscape as a whole, community banks have done very well. They generally tend to grow to a certain size and a lot of times they will sell their foot to a larger suitor, but that is not our objective, our objective is to be here for the long haul for the people not only of Coronado Island but for San Diego. We focus on creating shareholder value through providing that superior service that the big banks can’t provide. Just looking at the returns of community banks in general these last few years, it has been double digit returns annually and I am looking forward because I think the prospects for Coronado First Bank are great.”

CEOCFO: What is the effect of the current interest rate environment and the macroeconomic situation on the development of the bank?
Mr. Ives: “An increasing rate environment benefits us, because we are what they call asset sensitive, which means we have a lot of variable rate loans. As interest rates climb, our net interest rate margin, which is our primary revenue generator for the bank, that net interest margin increases because the rates on our loans are going up. It actually helps or benefits a community bank in an increasing rate environment. That is not necessarily the case with the larger bank.”

CEOCFO: Any final thoughts for our readers?
Mr. Ives: “At this point, we are maintaining our business plan. We are looking forward to continuing to grow into the future with this community and we feel we have a great community not only here in Coronado but in San Diego and southern California as a whole. With the delivery services that we can offer, I think there is nothing but a bright future ahead.”


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“We set ourselves apart from the competition by the service. When you walk into the door, you are not just a number but also a name. We call everyone by name; we know our customers, we are like a family here and we treat customers like that with respect. The turnaround is very efficient. We are able to provide all of the services that a big bank can provide but in a much more service-oriented light.” - Bruce A. Ives does not purchase or make
recommendation on stocks based on the interviews published.