News/Press Room

Letter from the CEO

The second quarter for Torrey Pines Bank was promising, as our local economy continued to grow and customers benefitted from the slow but steady recovery of the US economy. During the quarter, we saw an uptick in our key financial metrics. Our assets remained strong at $202 million, our deposits were stable at $172 million and our loans reached $119.6 million. Our net interest revenue grew to $1.98 million, up from the first quarter of $1.73 million. Net income for the second quarter was $337,000 and our net interest margin was 4.24 percent, up from 4.01 percent in the first quarter.

Our business results during the quarter were led by one of our key niche businesses - custom home lending. The ongoing strong performance of this market segment has exceeded our expectations, and we are optimistic about its future growth and contribution to our bottom line. This is a business that requires specialized talent and expertise, and for that reason, many competitors have not been interested or able to make this business niche work for them. We are fortunate to have our Los Altos team---VP Natalie Taaffe, VP Sandra Swenson and VP Maria Ybarra ---spearhead our growth on the Peninsula and to have VP Margaret Lowell in our Oakland office, growing this business throughout the East Bay.

During the quarter we launched some marketing initiatives to generate new business, especially among nonprofits, which is another solid niche for our bank. Through the energetic efforts of our relationship managers and private bankers, who will be backed by targeted marketing campaigns, we believe we will see measurable business among nonprofit organizations next quarter.

We still have a ways to go to achieve everything we have set out for ourselves to achieve, but I feel positive about the opportunities we have and the difference we can make with clients and prospects, as we continue to deliver on Torrey Pines Bank's unique brand promise, "Expect the Best. Experience the Difference."

Sedrick Tydus
President and CEO

New Regulations Impact Bank, Customers

Two new regulations being implemented this year - Regulation GG and Regulation E - will have an impact on US banks and their customers.

Regulation GG, the Unlawful Internet Gambling Enforcement Act (UIGEA) went into effect on June 1. This Act prohibits persons engaged in the business of wagering or betting from knowingly accepting payments in connection with the participation of another person in unlawful internet gambling.

For banks, this Act requires that they must not process restricted transactions in each of five designated payment systems - ACH, credit cards, checking accounts, wire transfers and money transmitting systems - unless the are exempted. Torrey Pines Bank is non- exempt and therefore has established comprehensive policies and procedures to adhere to this new regulation and to reasonably identify and block unlawful internet gambling transactions. The bank's Compliance Department, headed by VP Sandy Cobb, oversees the bank's regulatory responsibilities and staff training. Marianne De Guzman, assistant compliance officer, is responsible for the periodic monitoring that ensures our bank adheres to all regulatory policies and procedures.

Regulation E became effective July 1 and requires financial institutions to provide consumers with the right to Opt-In, or affirmatively consent, to the financial institution's overdraft (OD) services for ATM transactions and one-time, non recurring debit card transactions. No fee for these overdraft services may be assessed without every consumer's affirmative consent and there is a specific process banks must follow before they can impose an OD fee on their customers. They must send the customer a notice describing the institution's overdraft service, give the customer a reasonable opportunity to affirmatively consent to the service, obtain that written consent and then provide the customer with confirmation. If a financial institution has not obtained the consent of its customers, fees cannot be charged on new accounts opened on or after July 1, 2010 or on existing accounts on or after August 15, 2010. Torrey Pines Bank does not have a formal overdraft program, so we will not need to provide consumers with the right to Opt-In.

Educational Seminars, Civic Mixers Continue

During the second quarter, the bank's ongoing series of educational seminars on topics of interest to customers continued to be popular, and its outreach program to offer its headquarter facilities as a setting for civic events thrived as well.

In April, the bank hosted a seminar for nonprofit groups on "Building Successful Board /Staff Partnerships" and in May it sponsored a seminar for churches and nonprofit groups on "The Prerequisites for Fundraising Success." Both events drew big crowds and packed the bank's conference room. More such events are planned for the third and fourth quarters.

In June, the bank was the site for the Oakland Chamber of Commerce's monthly after-work networking mixer, drawing a big crowd of business and civic executives to our Oakland branch office, where they enjoyed food, drink and each other's company.

"We take our role as a community bank seriously, and want to provide groups of all kinds with access to our building for the purposes of education and networking opportunities that will help build businesses," said Sedrick Tydus, CEO.

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