Oriental Bank and Trust’s new and expanded commercial banking structure is starting to show the results of the growth that came with last year’s acquisition of the defunct Eurobank, with commercial loan production reaching $46 million during the second quarter, an increase of about 126 percent year-over-year, bank officials said Tuesday.
The results for the quarter ended June 30 reflects a 174 percent increase in comparison to the first quarter of 2011, ended March 31. Oriental also reported that commercial loan balances at June 30, of approximately $265 million had increased about 27 percent year-over-year and about 14 percent when compared to the first quarter of 2011.
“The work over the last six to nine months of building a team and a pipeline has started to pay off,” said José Ramón González, senior executive vice president of Oriental’s banking and corporate development. The executive joined Oriental in August 2010 after serving many years at Banco Santander Puerto Rico.
“We continue to see a good and growing quality pipeline. Oriental now has a client-based commercial business that is self-sustaining,” he said. “While inevitably some quarters may be stronger than others, it’s clear that we have a process and an expanding base line of business that will provide us with volume that is significantly higher than historically seen at Oriental.”
Oriental launched the expanded commercial effort last year after acquiring certain assets and liabilities of Eurobank in an FDIC-assisted transaction in April 2010. The acquisition helped to create a network of 30 strategically placed Oriental branches with a highly skilled and experienced professional staff, bank officials have said.
Oriental has historically been known for its focus on its wealth management business. In the late 2000s, Oriental expanded that approach to its consumer banking business, significantly increasing core retail deposits. Following González’s arrival, Oriental began to expand its relationship approach to commercial banking.
“It is mostly commercial loans with a sprinkling of income producing, non-speculative commercial real estate,” González said, adding loan growth has been diversified among mid- and small-sized businesses, and different industries. “There are always good clients to be found even in these difficult times.”
“Our focus is not on major corporate names, but rather on locally-based small and mid-sized businesses, where we can make a difference and develop strong, close relationships,” he added.
Last week, Oriental Financial Group Inc. released results for the second quarter ended June 30 that reflected income of $25.3 million, a significant increase from the $4.2 million loss reported for the same quarter in 2010 and a profit of $1.9 million for the first quarter that ended in March.