ARB Continues to Serve the Credit Needs of our Local Communities

Blog April 28, 2023 by Laurel Sykes

This being the last week of national Community Banking Month, we at ARB want to continue to educate our readers on why community banking is central to communities here on the central coast and nationwide. Collectively, community banks accept local deposits and deploy the funds back into the local economy—consistently making more than 60% of small-business loans and more than 80% of agriculture loans!

Annually, more than HALF of the small business loans originated by American Riviera Bank are made to business owners with $1 million or less in gross annual revenues, proportionately more than any other bank in our market.

Why are community banks so critical to the success of our region? Did you know community banks:

• Are committed lenders with local expertise in the markets they serve, and loan growth that has outpaced large institutions for years. In fact, ARB continued to increase loans (by 2% in Q1 2023) at a time where many lenders are reporting declines in loan volumes.
• Have a track record in helping underserved Americans by providing greater flexibility to low-income and minority borrowers. Community banks serve 93% of majority-minority communities and 96% of low-income designated counties.

• In 2022, ARB launched our new Simply Checking account, a Bank On certified account with a low monthly service fee and multiple options for waiving the fee, devoid of overdraft or non-sufficient fund fees. ARB is now one of only 200 financial institutions across the country that offers Bank On certified accounts!
• Social responsibility matters! We have a stated goal of donating 3% of our net profits to local non-profits and organizations in support of community improvement.
• More than 40% of our employees serve on boards of local non-profits and organizations, dedicating almost 3,200 hours in 2022 alone.
• Offer high-tech, high-touch service, giving consumers access to modern conveniences while maintaining superior personalized customer service for which community banks are known.
• • ARB continues to invest in technology services, increasing the ease and convenience of banking with us.
  • During the first quarter of 2023 alone, American Riviera Bank opened 784 new deposit accounts, compared to 562 in the last quarter, and 657 in the same quarter last year (Including 163 online account applications).
• Understand and embrace local small businesses. Community banks made 60% of total Paycheck Protection Program loans to small businesses and provided 72% of PPP loans to minority business owners that reported such data.
  • ARB made 1,065 PPP loans totaling $132 million in support of 13,209 local jobs in 2020 and 2021.
  • Excluding PPP loans, in 2021 ARB made almost $30 million in loans to small businesses in the San Luis Obispo County alone after only a few years in the market, at least $10 million more than any other lender in the County according to 2021 data reported by the FFIEC[1].

[1] https://www.ffiec.gov/craadweb/aggregate.aspx

• Demonstrate safety and soundness with higher capital ratios and better loan quality than the largest institutions. In addition, community banks tend to operate more conservatively than larger peers.
  • During the March 29 House Financial Services Committee hearing, Barr said the community banking system is “well-capitalized and stable and serving its communities.”
  • ARB continues to remain well-capitalized, with a strong liquidity position. ARB’s regulatory capital ratios were all above “well-capitalized” standards as of March 31, 2023. In addition, the Company’s tangible common equity ratio has increased to 6.68% on March 31, 2023, from 6.43% on December 31, 2022.
  • ARB maintains a conservative risk profile, with a focus on long-term resiliency and dedication to the communities we serve. We recently received the highest “Super Premier” rating for financial performance from the Findley Reports and has maintained a “5 Star - Superior” rating from Bauer Financial as of December 31, 2022.
    • All our depositors are local businesses and residents, and as of March 31, 2023, we had no wholesale brokered CDs on our balance sheet.
    • Our deposit base is as diverse as the communities we serve, with no significant industry concentrations. We do not engage in cryptocurrency transactions or service cryptocurrency related companies.
    • Decisions are made locally, by a well-experienced management team with a deep understanding of the communities we serve.
    • We have continued to maintain strong credit quality with no other real estate owned, no loans 90 days or more past due, and only $3.0 million or 0.32% of total loans on non-accrual status as of March 31, 2023, which are well supported by collateral and reserves.
  • Banks provide peace of mind that comes from deposits being FDIC-insured, up to $250,000 per depositor. As a member of IntraFi® Network Deposits^SM, ARB also offers options for maximizing your FDIC insurance up to $50 million through options such as Certificates of Deposit Registry Services (CDARS) and Insured Cash Sweep (ICS).

Despite the unprecedented challenges over the last several years, we believe there’s never been a better time to be a community banker, and there’s never been a better time to bank locally! We invite you to visit any one of our local branches, including our newest branch located in Santa Maria, to see for yourself what True Community Banking means!

#bankonBETTER