News/Press Room

Investor Newsletter 3Q 2009

Three years ago in October, we opened the doors to Torrey Pines Bank in Oakland. As we did so, we were intent on fulfilling our vision to fill a void in the financial services world by providing the high level of customer service and sophisticated products that businesses and consumers deserve, but have trouble obtaining from big banks.

Today, we have three offices serving businesses and consumers in Alameda, Contra Costa and Santa Clara counties and we take pride in the specialized focus we have on selective industries, as well as our experienced bankers and administrative staff, who deliver on our original vision every day. The Los Altos office, opened this year, has been a great success. The team is outstanding and is making a significant contribution to the bank. Because of our positive experience in this new market, we plan to increase our presence and investment in Santa Clara County.

It has been an exciting and satisfying 36-month journey, but as we all know, this last year has been especially challenging. While uncertainty about the economy persists, we are certain about the opportunity and strength of the Bay Area, which we expect to be a leader in the economic recovery of the US economy.

One area that continues to generate concern is the current lack of available credit for small businesses. If you read the recent spate of news stories about big banks stepping back from small business lending activity, you might think it is nearly impossible for a small business to secure a bank loan. While it is true that lending standards have risen and credit access has been more limited, many community banks, such as Torrey Pines, do have money to lend. We have a strong deposit base and we want to use those dollars to make loans to borrowers who meet the necessary credit criteria. Some of the businesses we have been able to help this year with lending needs have included physicians, property owners and professional firms. We invite you to call us if a business loan would be helpful to you or someone you know.

As we have continued to hire talented staff, we have seen our business expand in key areas. For example, we are now developing a deeper business with real estate rental and leasing property owners, and we continue to broaden our service to nonprofit groups, churches, and private and charter schools. We expect this trend to continue.

During the third quarter, our assets remained strong at $176.1 million, our deposits totaled $149.1, and our loans remained over $100.1 million.

On behalf of everyone at our bank, as we mark our third anniversary, we thank you for your continued support.

Arnold Grisham
Chief Executive Officer

RENTAL PROPERTY OWNERS BENEFIT FROM SERVICES/PRODUCTS

Rental-property owners seeking to purchase or refinance a building with five or more units must often scramble to find a bank loan because those properties are not eligible for Fannie Mae loans, which are limited to building of four units or less. At Torrey Pines, having access to a relationship banker who can help expedite loan decisions is just one of many services that benefit bank customers who own rental property in the Bay Area and differentiate Torrey Pines from other, larger financial institutions. Helping rental property owners manage their cash flow more efficiently is another benefit.

“Property owners generally use non-interest bearing checking accounts. We provide additional value through the services we offer which enables property owners to manage their cash more effectively. The big banks can’t seem to match our combination of personal service and technology,” explains VP Jeff Becker, who is spearheading the bank’s business efforts with this niche market.

One example, especially important for small rentalproperty owners, is free or low-cost checking options, and the ability to have a single point of contact inside the bank through their relationship manager. Large rental-property owners benefit from sophisticated cash management technology that improves cash flow and operational efficiency.

“With our e-Deposit technology, property owners get their rent money into the bank faster and they do not have to go to a branch and stand in line to make a deposit. Equally important are the operational benefits,” says Jeff. “All the data is captured in our scanner and can easily be uploaded directly into their bookkeeping software. Customers no longer need to make photocopies of each check, and the scanner captures the data and stores the check image. E-Deposit saves them time, and ensures accuracy.”

In seeking to reach landlords with the tools they need for their financial success, the bank has begun working closely with RHANAC - the Rental Housing Association of Northern Alameda County. The association has some 1,200 members who own more than 15,000 multiple-family rental units in East Bay cities. Not only does the bank provide education and outreach to the members, it offers the nonprofit membership association use of its conference room for board meetings and member events.

“We have gotten excellent feedback from RHANAC members about the sense of partnership the bank has with its customers and prospects,” says Jeff. “They know that the distinctive service and value we bring to rental property owners is unique.”

NEW BANKERS

Two new bankers have joined the Torrey Pines team, bringing experience and expertise in business market segments the bank serves.

Jay Mok, a senior vice president and commercial lender, brings both loan portfolio management experience as well as marketing and sales background in generating new loans. He will be focused on building lending relationships with Bay Area businesses, in the bank’s target segments. Prior to joining the bank, he had been a vice president and senior lending officer with Innovative Bank in Oakland, and before that, with Nara Bank, also in Oakland. He earned a B.A. degree from the University of California, Berkeley.

Jeff Becker, a vice president and relationship manager, will work with small businesses, non-profits, and high net worth individuals providing cash management, private business banking and commercial lending services. Prior to joining Torrey Pines, Becker worked at JP Morgan Chase as a vice president, serving middle-market and small businesses. Prior to that he held managerial and customer focused positions at E-Loan, Bank of America and All Pacific Mortgage. Becker earned an MBA from Pepperdine University and a BS degree from California State University at Hayward.

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