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Jan 31, 2012 4:03 PMPublication: The East Hampton Press

Bridgehampton National Bank Continues To Thrive In Difficult Times

Feb 20, 2012 10:14 AM

Since the credit crisis first gripped the United States in 2008, many small- and mid-sized banks have struggled just to stay afloat—any talk of expansion has been restrained by regulations, uncertain financial security among customers, and stringent new lending practices.

But those same years have been a period of unprecedented growth at the century-old Bridgehampton National Bank, crowned by a 2011 earnings report, released last week, showing record profits, a burgeoning loan portfolio and deposit pool, and a doubling of its total assets in the last four years, to some $1.3 billion. Over that period, the bank has also expanded from 13 branches to 20, with at least three more additions already on the drawing board, and has grown from 120 employees to 210.

In 2011 alone, the bank grew its total assets by 30 percent, and the amount of its loans by 21 percent, to more than $600 million. Deposits at the bank also grew by 30 percent, to nearly $1.2 billion, according to the bank’s fourth-quarter earnings statements. The year also saw BNB make its first-ever acquisition, purchasing Southampton-based Hamptons State Bank.

These are heady days at BNB, to be certain. And while a fair number of backs are being patted, the captains of BNB say their ship is still far from port.

In interviews this week, CEO Kevin O’Connor said the bank continues to plan for much greater growth, a further expansion of its regional coverage, and wants to attract new customers from the markets that it has already established.

By comparison, Suffolk County National Bank has 30 branches and total assets of about $1.5 billion. Nassau-based First National Bank of Long Island has 35 branches and about $1.9 billion in assets. North Fork Bank, when it was gobbled up by mammoth Capital One, was 360 branches strong and had about $60 billion in assets.

“I think we have the infrastructure to be a $5 billion bank—we’ve got some key people in place to be able to do that,” Mr. O’Connor said during an interview at the bank’s Bridgehampton headquarters. “We’re going to continue to add branches, we’re going to continue to add people. The marketplace we’re in still has untapped potential.”

Having sailed through the worst financial storm to hit the country in more than a half century with its colors flying, Mr. O’Connor’s optimism is hardly surprising. Nonetheless, the CEO said, as expansion continues, the keys to future success will rest in his bank’s ability to adhere to the core principles that have fueled its growth since the bank’s founding in 1910 through to the mercurial expansion of recent years.

At the risk of sounding trite, BNB’s leaders say they have built their business on the backs of friendly, personal service, community involvement, employees who connect with their customers, and a careful but savvy lending policy.

The growth thus far and into the future also depend on a certain amount of foresight, particularly in corners that may not be big-income generators, like back-room clerical and accounting staff. That approach has kept BNB ready to handle the myriad obstacles that have landed in the paths of lenders and borrowers in the wake of the financial crisis.

“We recognized early on that things were going to change from a regulatory standpoint, and we tried to build an infrastructure to handle that,” Mr. O’Connor said. “It’s no secret that one of our primary competitors has had the other problem—they’ve had a difficult time with the regulators. That allows us to go see a customer who has just been told by another bank, ‘sorry, we can’t do this and we can’t do that, the regulators won’t let us,’ and we can say, ‘I think we can do that.’ If you can say that, you win.”

With the sort of red tape that has threatened to knock Suffolk County National Bank’s stock off the prestigious NASDAQ index—for failing to submit earnings statements on time—swept aside, BNB has been free to grow its business through lending. The concerted campaign of adding branches has been driven not only by locations that make sense from a regional coverage standpoint, but the appeal of places where deploying the right personnel could draw new business in quickly. In some areas they have made adjustments, highlighted by the opening of new branch offices in Southampton and East Hampton villages, that have helped them expand their business in existing markets.

“We’ve identified new markets and found some veteran bankers who worked for what were once community banks and wanted to come work for us. They’ve taken branches from zero to $20 million,” Mr. O’Connor said. “In East Hampton, an old market for us, a new location has helped us grow because it provided customers with what they wanted: a drive-up and parking. In Mattituck, we brought in a person that has turned around an inferior location.”

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Tom Tobin deserves a lot of the credit for making this bank what it is.
By dnice (2345), Hampton Bays on Feb 1, 12 7:05 PM
Thank Providence for the "little guys".

TBTF, NOT!
By Mr. Z (11477), North Sea on Feb 3, 12 10:05 PM
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