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14 Tampa banks, credit unions deemed 'problematic' or worse

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By MICHAEL SASSO | The Tampa Tribune

Published: September 14, 2009

TAMPA - Economists are debating whether the recession is ending, but for now some Tampa Bay-area banks are still hurting, according to data from a bank rating service.

BauerFinancial, a Coral Gables-based firm that rates banks and credit unions, gave 10 banks and four credit unions in Hillsborough, Pinellas and Pasco counties a rating of "problematic" or worse based on the financial reports they filed June 30.

To earn such a rating, a financial institution must get two stars or less on BauerFinancial's rating scale, which gives five stars to the strongest financial institutions and zero stars to the weakest.

The worst rating in the area went to First Commercial Bank of Tampa Bay, a small Tampa-based bank that received a rating of zero stars from BauerFinancial. Earlier this summer, the Federal Deposit Insurance Corp. ordered First Commercial Bank to improve its finances and its loan quality.

Albert Salem Jr., First Commercial Bank's chief executive, said he hadn't seen the new rating and couldn't comment on it Monday. The bank has complied with the FDIC's order to improve its loan quality, he said.

Two local banks receiving 1-star ratings – which BauerFinancial calls a "troubled" rating – were Synovus Bank of Tampa Bay, which is based in St. Petersburg, and Southern Commerce Bank N.A. of Tampa. Both of those banks fell from two stars in BauerFinancial's previous rankings. The Tribune was unable to reach representatives of the two banks Monday afternoon.

To be sure, only a minority of local banks and credit unions are in problem territory, according to BauerFinancial's rating system. Four local banks and 12 local credit unions earned five stars, or the "superior" rating. All of them have held that rating for at least two consecutive quarters.

Karen Dorway, president of the rating service, said her company evaluates banks and credit unions every three months on their levels of capital, percentage of loans at least 90 days late, repossessed properties and other measures. When her firm did its last evaluation, which studied March bank reports, she had hoped things were starting to stabilize.

However, the June figures showed that loan delinquencies increased at many banks that already were having trouble, Dorway said.

In one bright sign, fewer banks and credit unions fell into problematic financial territory in June. The pace of decline had been greater in previous quarters, she said.

BauerFinancial makes its star ratings available to the public at its Web site, www.bauerfinancial.com.

Reporter Michael Sasso can be reached at (813) 259-7865.

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