Marin County benefits from healthy lenders; lessons from Hamilton
NORTH BAY – Keeping money and resources in the community was the underlying theme of Impact Marin, the third-annual issues-centered conference sponsored by the Business Journal and focused on Marin County.
Held at the Embassy Suites in San Rafael and attended by about 160 people, the panelists were Russell Colombo, president and chief executive officer of Bank of Marin; Moss Adams’ Senior Business Consultant Steve Jannicelli; Orion Partners principal Haden Ongaro; Matthew Hymel, Marin County administrator; and Bill Petrocelli of Book Passage.
The speakers addressed a broad spectrum of topics from the local impact of added bank lending through the federal Troubled Asset Relief Program, how businesses are adjusting to the new economic reality, the ripple effect of the state fiscal crisis, the lessons of the success of the Hamilton Landing development to the importance of supporting local retailers.
A summary of each of the speakers follows:
Russ Colombo, Bank of Marin
Mr. Colombo said there is a lot of misunderstanding about the U.S. Treasury’s Troubled Asset Relief and Capital Purchase, or TARP, programs.
He said the public has tended to lump all financial institutions in with the large banks that received the initial $125 billion, some of which didn’t want the funds.
Bank of Marin participated in the program, receiving $28 million from the Treasury. The Treasury, in return, received preferred stock under the program.
Because the funds are part of the bank’s capital base, they will allow Bank of Marin and other banks that receive the funds to leverage them with significantly higher amounts of lending.
Mr. Colombo said Bank of Marin quickly lent the entire $28 million into local markets.
But not everything about the program has been easy, he said. The Treasury rolled the program out very quickly, “almost a ready, fire, aim,” he said. The agreements with the banks that elected to participate are still in flux as the rules keep changing.
When the first signs of the economy’s downturn were visible, “There was a desire to get capital quickly, and make the rules later,” he said.
What banks should be doing is putting the money back in the community. That is the purpose of the program, so the local economy is stimulated and local businesses are supported.
Then, he said, the local businesses can turn around and put that money in the community by helping nonprofits and other community-based projects.
He also recommended to business owners that they do their homework when choosing a bank.
“Look at the bank’s nonperforming loans,” he said.
In a positive for Marin County, he said, there are a lot of prudent lenders.
“We have a lot of banks that are very healthy,” he said.
He also encouraged local companies to support community organizations with financial and other resources.
Steve Jannicelli, Moss Adams
“We have been living on credit both personally and professionally,” Mr. Janncelli said.
“People seem to be wondering when it is going to go back, and my hope is that it never goes back. The last 10 years have been a series of bubbles and anomalies.”