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 Company
Profile:
Temecula Valley Bancorp Inc. (NASDAQ: TMCV) was
established in June 2002 and operates as a holding company for Temecula
Valley Bank which was founded in 1996 and is headquartered in Temecula,
California.
A full range of commercial banking services are provided to small and
middle-market businesses and individuals through eleven full service banking
offices in the Riverside, San Diego and San Bernardino Counties.
Community-focused banking offices offer business loans and lines of credit.
In addition, competitive business and personal deposit products are
provided, including checking, money market, and time deposit accounts.
Online banking, bill payment and cash management services are also
available, including remote deposit capture, electronic funds transfer
through ACH and wires, and other business services. Regional commercial and
SBA loan offices are located throughout the state of California. The Bank is
an SBA Preferred Lender.
 Frank
Basirico, Jr.
Chief Executive Officer
Temecula Valley Bank
Temecula, California
Frank Basirico, Jr., Chief Executive Officer of
Temecula Valley Bank joined the executive team in 2006 as Senior Executive
Vice President and Chief Administrative Officer.
Prior to joining Temecula Valley Bank, Mr. Basirico served as Executive Vice
President and Senior Loan Officer for Citizens Business Bank, a $6 billion
bank headquartered in Southern California. Mr. Basirico has a proven
executive management track record, having served as the Chief Lending
Officer and Chief Operating Officer for the Bank of Hemet, and has over 30
years of banking experience contributing to the success of super-regional
banks and Southern California community banks, in a variety of senior level
positions.
A graduate of California State University San Bernardino, Mr. Basirico has
been a past instructor for San Bernardino Valley College and past Chair of
Risk Management Association, Inland Empire Group. Mr. Basirico is a
long-term California resident and currently resides in Temecula with his
wife of 15 years. |
Financial
Regional – Pacific Banks
(TMCV-NASDAQ)
Temecula Valley Bancorp Inc.
27710 Jefferson Avenue
Suite A 100
Temecula, CA 92590
Phone: 951-694-9940
TMCV Fact Sheet
TMCV Print Version
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Interview conducted
by: Lynn Fosse, Senior Editor, CEOCFOinterviews.com, Published – January 16,
2009
CEOCFO: You’ve been with Temecula Valley
Bancorp for awhile, but have taken over as CEO during perhaps the most
tumultuous time in the banking industry; what is your vision today for the
bank?
Mr. Basirico: “Based on what is
happening in the financial services sector right now, we’re heightening our
focus on our core business lines, which includes community banking and
middle market lending. Fortunately, we have several bankers that have 10 to
20 years history with many of their customers. We are privileged to have
strong loyalty in this customer base. In the past, we have had a national
presence in SBA lending with business development officers in various states
across the country. Part of our strategic plan change for 2009 is to
pull-back into the state of California and focus mainly in the communities
where we have branch representation.”
CEOCFO: How are the communities that you
serve faring today?
Mr. Basirico: “Today, as in most areas
of the country, the economic environment is problematic or difficult at
best. We are seeing increasing unemployment in many of the markets that we
are serving. We are also seeing foreclosures putting pressure on the local
real estate market. Although the bank does not originate permanent
residential mortgage loans and thus have not made any sub-prime loans, the
recession in the housing market has affected us. We are seeing some
difficulties from the fallout of the subprime market collapse because there
have been so many foreclosures in local single family residential
developments. As a result, some of our projects have not sold as quickly as
projected when the developments were underwritten at project inception. It’s
a difficult environment, but we are taking the ‘bull by the horns’ and doing
everything possible to minimize our non-performing loans and our other real
estate owned in the portfolio.”
CEOCFO: How do you breakdown between
consumer and commercial and do you look for that mix to change?
Mr. Basirico: “We really don’t expect
the mix of business and consumer to change at all. We are a wholesale bank
and so we do very little consumer lending. Consumer lending probably
represents less than five percent of our total lending at the present time,
and that direction will not change. We will continue to be a community bank,
serving small businesses and middle-market companies.”
CEOCFO: In the small business,
middle-market arena, are there particular industries on which you focus?
Mr. Basirico: “Not particularly. We want
to try to provide service to all of the industries in our communities.
However, if there were a particular industry that we don’t have specific
expertise in-house, such as car dealerships or automotive flooring
facilities, we wouldn’t go down that path. It is the same thing with
mortgage warehousing; we don’t have a mortgage warehousing department. We
want to stick to the basics and make sure that we follow the strength of our
bank, with the expertise that we have in the various communities.”
CEOCFO: Why are your customers choosing
Temecula Bank?
Mr. Basirico: “The main reason is that
we provide heightened customer service, but more importantly, many of our
long-term employees have very solid relationships with long-term clients.
Satisfied customers value and trust the advice of our experienced bankers
and in turn refer their friends and associates to the bank.”
CEOCFO: Are there services that you are
not providing now that you would like to add to the mix?
Mr. Basirico: “We expanded our business
services department to offer cash management services to our business
clients about two and a half years ago. We now have remote deposit capture
and a competitive offering of online services, which allows us to service
some customers that are slightly out of our branch footprint. At the present
time, we have the products and services that meet the needs of our
customers. Not to say that we wouldn’t take advantage of new product
opportunities in the next 6 to 12 months, but today we are in pretty good
shape in this regard.”
CEOCFO: You mentioned customer service;
would you give us an example of what someone might find that is different
when working with Temecula Valley Bank?
Mr. Basirico: "Many of our line officers
that have been with our company for a significant period of time have
delegated authority, so the customer is actually interfacing and dealing
with the local decision makers. Our community bankers have the knowledge of
their particular community, they have the knowledge of the local business
market, and so they are better prepared to actually provide heightened
customer service in their area. It is because of the personalized service
that we provide that we have earned many long-term customer relationships.
That differentiates us from some of the regional mega-banks that are in
competition with us.”
CEOCFO: Do you find that there is much
difference among the communities that you serve?
Mr. Basirico: “Today, I think that there
is a little difference in Southern California. As you travel farther inland,
away from the beach communities, those markets have been hit, maybe a little
more dramatically, by the economic downturn than some of the coastal
communities. We haven’t seen some of the housing prices soften quite as much
along the coast as we have inland. Our service areas in Riverside and San
Bernardino Counties have been hit a little bit more drastically than coastal
San Diego communities. The main differential is that unemployment,
foreclosure levels, and price point deterioration in the housing market are
more dramatic as you travel inland.”
CEOCFO: Tell us about the community
involvement for the bank and if that would be changing in the next year or
so?
Mr. Basirico: “We’ve always taken a very
supportive posture of community involvement. In fact, many of our senior
officers have been intimately involved with various community functions
within their respective communities, and that will continue. Historically it
has been our privilege to contribute both financially and through volunteer
hours to local schools and nonprofit organizations. We remain committed to
making a positive difference in communities in our market place. Our local
bankers will continue to reinvest in their communities by contributing their
time and sharing their experience through educational programs for financial
literacy, performing volunteer work and serving as board members to numerous
organizations. It remains one of our core values to serve not only our
customers, but also our communities.”
CEOCFO: What’s ahead for Temecula Valley
Bancorp?
Mr. Basirico: “There are a couple of
areas that we will continue to focus our attention towards in 2009. The
first area of focus is really taking a proactive posture to our
non-performing assets and reducing the classified loans. The second thing is
to get back to our core business line of community banking.
We are going to focus on our activities within our
respective communities and get back to our roots as a community bank,
providing financial products and services to local business owners and
offering the high levels of service they deserve. We have had a national
presence in SBA lending and that will change in 2009. Our focus will be on
the California marketplace, specifically in the locations where we have
branch representation. That is a major strategic change for our company.”
CEOCFO: What’s the financial picture
like for Temecula Valley Bancorp today?
Mr. Basirico: “The bank is still well
capitalized and our strategy is to maintain a well capitalized position. We
are experiencing some of the same challenges as many other banks, community
banks in particular. We do have additional exposure in the construction
arena, where our strategy is to reduce our concentration in construction and
commercial real estate, while continuing to offer financing to our local
businesses. As we focus on the California market, SBA business development
efforts will be targeted locally. One of our major financial objectives
right now is to improve profitability. We’ve gone through a major operating
expense control study. We are implementing new strategic initiatives, which
include strategic reductions in personnel and other operating expenses, as
well as a reallocation of current resources, which are expected to result in
over $10 million in savings on an annualized basis.”
CEOCFO: What gives you the confidence to
takeover the CEO role today?
Mr. Basirico: “First it is based on some
of the experience that I’ve had in my 30 years of banking. Secondly, I feel
very comfortable with the board and the support that we have as far as
management is concerned. Thirdly, is the support that we have with our
senior management team and our executive officers across the board, as well
as our line officers. We are favored with some very long term, solid bankers
in our company, and with all of us pulling together, it gives me the
confidence to get the bank on the right path in 2009.”
CEOCFO: For investors that are putting
companies on their radar screen, why should they be looking at Temecula
Valley Bancorp?
Mr. Basirico: “As you know all of the
financial sector stocks have fallen this year and our stock is no exception.
In fact, we view the current valuation on our shares as being very
attractive. I don’t recall anytime in the last several decades where you
could buy shares of community banks at substantial discounts to book value.
With our book value at $10.11 as of September 30, 2008, our stock is a
tremendous buy for a value investor. In fact, in the last week, we have seen
an increase in our stock price, also the trading volume on a daily basis has
increased pretty much three fold from our normal average trading activity.
Therefore, once the shareholder environment recognizes the direction that we
are going to take the bank in 2009, I think there will be renewed confidence
in our company, which should be reflected in our stock price going forward.”
CEOCFO: Final thoughts, what should
people remember most about the Temecula Valley Bancorp story today?
Mr. Basirico: “I’m encouraged overall as
to what we view happening in our company in the next 6 to 12 months. We have
a lot of work to do, but we have the right staff to make sure that we do all
of the appropriate things and get the bank going down the right path.”
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