Wednesday, January 24, 2018

Hayward's Bank...By the Numbers!

Based in the September 30, 2017 FDIC call report, Hayward's Bank had a total of $ 22,969,000 in total loans.

So the Mayor's mortgage represents 4.3% of total loans.  

Ask yourself, what percentage of your banks TOTAL LOANS (mortgages, car loans, business loans, equipment finance, HELOCS) is your mortgage?

4.3%?

The bank's website does not even list loans as a product.  It just has a link called "Lending" that states:

Lending Services
Please call 850-455-7351 and ask for the Loan department for information. Thank you!

Hayward's Banks Web Page

A review of Clerk of Court data for Hayward's Bank's mortgage modifications similar to the Mayor's interest only modification shows since the Mayor took office, the Bank has done 84 mortgage modifications.  Most were these types of interest only loans.

In fact, 4 modifications have been done for the Mayor. 4.7% of all modifications.

Modifications such as the Mayor's have been done for several prominent business leaders as well as numerous modifications for AMFI and Five Flags banking group executives and employees.

In fact, a review of modifications like Hayward's reflects approximately $10,000,000 of the banks $23,000,000 in total loans are under the just this type of interest only never pay down your principle arrangement. (43%)

The $10,000,000 covers approximately 25 loans.  So 25 loans are 43% of all the money the Bank has loaned out as of September 30, 2017.  The Mayor's loan is approximately 9.8% of the present total under the interest only program.

The Mayors modified mortgage is the fourth largest interest only mortgage the Bank has.
  • One is a high net worth business leader who sits on another related banks Board of Directors.  Their estimated net worth is $ 5-10 million.
  • A prominent local pediatrician with 44 years of practice.  Their estimated net worth is $ 5-10 million.
  • A retired insurance executive.  Their net worth is estimated at $ 5-10 million.
Then there is the Mayor.... 
  • Salary - $100,000 and could be unemployed this year.  Spouse's finances unknown.
  • Underlying house listed for sale for 8 consecutive years.  List price is $367,000 over the estimated value of the home.
  • Real estate "development" the Mayor is a partner in owes the Bank's affiliated insurance company $4.8 million for a property with an estimated worth of $ 1.4 million.
Ummm. I would love to see the loan file on this.  

Pensacola..Where Bob Sugar got it wrong...IT IS show friends not show business.

3 comments:

Anonymous said...

I believe the bank is doing good for Pensacola. I would separate the Bank's "lending practices" from the Mayor's governance (which has been horrible). An institution that has been around in Pensacola as long as AMFI and BOW, SHOULD have some influential customers that it has "prime lending" rates --THAT"S GOOD BUSINESS. The Mayor has been the beneficiary of utilizing his connections to achieve a good rate. However, the bank is doing good business and has collateral and a borrower that can cover the downside lending risks (I am sure there is a personal guaranty).

Anonymous said...

Not sure why this has even governed so much attention here. Larger principle mean larger interest payment(basic math). If he makes the payment the bank does not care if he pays the principle down just means they keep making more money from the interest applied. Again fail to see how this is bad business by the bank.... bad management of money by Hayward maybe, maybe not, no one knows his personal finances. So as long as the bank gets its interest payments now, then gets the original loan amount in the end it is a win for the bank. The bank actually make more money this way resulting in good business by the bank and profits.

Anonymous said...

You write: “Based in the September 30, 2017 FDIC call report, Hayward's Bank had a total of $22,969,000 in total loans. So the Mayor's mortgage represents 4.3% of total loans. Ask yourself, what percentage of your banks TOTAL LOANS (mortgages, car loans, business loans, equipment finance, HELOCS) is your mortgage?”

Ms. DeWeese, this is not at all uncommon for institutions similar to Warrington Bank with very small loan portfolios. Moreover, from a safety and soundness standpoint, the ratio you cite here (4.3% of total loans) is not really relevant anyway, as banking regulators are far more concerned about loan concentrations as a percentage of an institution’s total capital. This is why the State of Florida, for instance, has established “legal lending limits” for its chartered financial institutions as follows: “…A bank may extend credit to any person, including any related interest of that person, in any amount up to 25 percent of its capital accounts for loans and lines of credit, all components of which are amply and entirely secured (Florida Statute 658.48(1)(a).” We can all do the math here. What we’ll find is that Mr. Hayward’s mortgage with Warrington Bank is well within the regulatory framework described above. You have mentioned elsewhere on your blog that the Zillow estimated value of Mr. Hayward’s residence is $1,531,153. You have also specified the outstanding balance of Mr. Hayward’s mortgage with Warrington Bank on your blog. These figures, if accurate, would result in a very low loan-to-value ratio (LTV) of 64%. Therefore, Warrington Bank’s 1st mortgage position appears to be fully secured and well within supervisory lending limits. Also, Warrington Bank’s Uniform Bank Performance Report indicates that past due loans have been virtually non-existent, which would also indicate that Mr. Hayward’s loan has performed as agreed. There really is nothing to see here. Warrington Bank’s lending and other operating practices have held up to regulatory scrutiny and examination for decades, which is why it is one of the last surviving community banks in Pensacola.