Tough Market Won't Stop CNLBank's Growth Plans
By Brian Bandell
Friday, April 11, 2008

Florida has not been a paradise for banks lately, but that hasn't stopped Orlando-based CNLBank from keeping its expansion on track in the state's southern region.

At a time when competitors such as BankAtlantic and Citibank are selling branches and halting statewide expansion plans, CNLBank is building its third branch in South Florida. Veteran bankers from Colonial Bank and its acquisition, Union Bank, have signed on to lead CNLBank's push for business customers.

Privately held Orlando-based CNLBancshares owns CNLBank and separately chartered banks of the same name in Jacksonville and Fort Myers. Former Gov. Jeb Bush serves on the board of the parent company, which has $1.4 billion in assets between its three banks.

That asset growth has sprouted up from scratch in just seven years, said Lynne Wines - formerly Colonial Bank's South Florida president and CEO for commercial banking - who became CEO of CNLBank's South Florida region in January. She hopes to grow the bank's South Florida assets to the $1 billion level and have 10 to 12 branches here.

It won't place branches on every corner or advertise teaser interest rates in the newspaper, Wines said.

"We are a business bank," she said. "We hope to attract businesses, developers, investors and their families."

CNLBank's current South Florida branches are in Boca Raton, Fort Lauderdale and Coral Gables, where the permanent office is undergoing buildout. It has 25 employees and is looking to bring on more, Wines said.

Raul G. Valdes-Fauli, CNLBank's CEO for the Miami area, said there are enough bright spots in the market to launch a successful bank. Formerly the president of Colonial Bank's Miami operations, he joined CNLBank in March.

Avoiding construction loans

Like most banks, CNLBank will avoid condo construction loans but it has been active in commercial mortgage deals in South Florida, Valdes-Fauli said.

"People are looking to acquire properties for deep discounts and get a little bit of financing," Valdes-Fauli said. "We'll do analysis to see if the buyer is getting it at a 30 percent discount and, if 10 percent of the tenants walk out, would it still work?"

CNLBank has also done some residential loans where the values made sense, he said. Valdes-Fauli said he looks at proposals on a case-by-case basis, instead of blacklisting entire buildings, as some banks have.

Despite the rising bad loans and declining profits for many South Florida banks, the region is still among the nation's top five for banking, said Miami-based bank analyst Kenneth H. Thomas, who runs He contends there are plenty of opportunities for new banks, especially as some major players stumble.

"While banks that got in trouble with subprime mortgages and exotic financing are trying to cut back, most of the smarter banks are focusing on basics," he said. "This opens up opportunities for community banks like CNL that don't have subprime hangover."

Thomas said CNLBank shouldn't spare any expense in setting up its new branches. Even though it's targeting business, rather than retail, he stressed that a prime corner site helps new branches grow quickly.

CNLBank 2007 financials

Source: FDIC, for Orlando-based bank. Financials for Jacksonville and Southwest Florida banks are not included. | (954) 949-7515
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