FNB
News
FNB
First National Bank of Northern California
Mail Center
450 Cabot Road
South San Francisco, CA 94080
NEWS
FIRST NATIONAL BANK OF NORTHERN CALIFORNIA
Volume 5, Issue 1
Return Service Requested
Summer, 2009
Message from the CEO
I hope this summer edition of our newsletter finds
you well! What a year it has already been! Undoubtedly, the
economy has each of us looking for ways to
streamline and from the positive feedback received
from many of you about the importance of this
newsletter we realized that narrowing the
newsletters from four to two this year will satisfy
everyone’s needs and most importantly, keep you
apprised of YOUR BANK.
I have had the pleasure to talk personally with many of our customers and there
continues to be a sense of anxiety about the length and depth of this recession, but
you can continue to rest assured that FNBNC is safe, secure and solid and that we
continue to care about the communities we serve. For the past 46 years this has been
our business model and each day we dedicate ourselves to offering quality products
and services to help people and businesses realize their dreams. It’s that simple, but
it’s that important.
Thank you for your business and
your support. Our Vision: To dedicate ourselves to developing relationships with our customers to fully meet their needs for quality banking products and services.
Branch Locations & Hours
Should you have any comments
or questions you can reach me
at 650-875-4865 or
[email protected]
Colma*
1300 El Camino Real
Colma, CA 94014
millbrae/san bruno
1551 El Camino Real
Millbrae, CA 94030
redwood city*
700 El Camino Real
Redwood City, CA 94063
South San Francisco*
211 Airport Blvd.
South San Francisco, CA 94080
650 997.3100
650 871.4400
650 299.0700
650 873.0211
Complimentary Seminar
Daly City
6600 Mission Street
Daly City, CA 94014
PACIFICA
210 Eureka Square
Pacifica, CA 94044
SAN FRANCISCO****
699 Portola Drive
San Francisco, CA 94127
South San Francisco
975 El Camino Real
South San Francisco, CA 94080
We’re in it for the Long Haul
650 992.8800
650 359.5500
415 661.4800
650 583.8450
El Granada
Princeton Harbor
El Granada, CA
–ATM Only–
PACIFICA
1450 Linda Mar Shopping Center
Pacifica, CA 94044
SAN FRANCISCO***
65 Post Street
San Francisco, CA 94014
650 359.5811
415 781.0600
HALF MOON BAY
756 Main Street
Half Moon Bay, CA 94019
Pescadero**
239 Stage Road
Pescadero, CA 94060
san mateo
150 E. Third Avenue
San Mateo, CA 94401
650 726.6373
650 879.0785
650 340.1033
Open Monday through Thursday: 9 am - 5 pm, Friday: 9 am - 6 pm, Saturday: 9 am - 1 pm
Exceptions: *Monday through Friday: 9 am - 6 pm **Monday through Thursday: 9 am - 4 pm, Friday: 9 am - 6 pm
***Monday through Friday: 9 am - 5 pm ****Monday through Friday: 9 am - 5 pm, Saturday: 9 am - 1 pm
Sincerely,
A Community Bank You Can Count On
—FNB Plays it Safe
FDIC Covers Up to $250,000
Tom McGraw, CEO
Meet Another of Our Board Members—
Ed Watson
First National Bank of Northern
California Privacy Policy
George Venezia Retires from FNBNC
www.fnbnorcal.com
A Community Bank
You Can Count On—
FNB Plays it Safe
T
he magnitude of trouble caused by
Wall Street’s derivatives, sub prime
loans, and hedge funds is
enormous: to date—a 12-trillion-dollar
loss in net worth from US households,
and 8-trillion dollars of stock market value
wiped out. Plus, financial institutions that
were once household words have
disappeared over night. No wonder you’re
a little worried.
Well there is one financial institution
that you can be absolutely sure of—First
National Bank of Northern California. It’s
solid and healthy. And, as for selling shaky
esoteric products, CEO Tom McGraw
says, “I tell people we do have derivatives
here at our bank. Instead of calling our
chairman Michael, we call him Mike.
Instead of calling our president James, we
call him Jim. Also, many of us do have
hedges, but those are things that we trim
pretty regularly.”
But seriously folks, the larger banks, with
a high-risk profile, were willing to gamble
on these highly leveraged financial
products. They made many bad loan
decisions and got into trouble, while
FNB didn’t.
A Classic Community
Banking Model
FNB takes your local dollars and lends
them to local creditworthy borrowers.
These dollars then get recycled and
A Community Bank. . . . . . .Continued on Page 2
member
EQUAL HOUSING
LENDER
FDIC
From Page 1. . . . .A Community Bank You Can Count On
spent in the community at large, creating
a better quality of life and a healthier local
economy. This is unlike the large regional
or nationwide banks, which funnel money
out of the area and send it across country
to headquarters in Minneapolis, New
York, or Charlotte.
What to Look for in a
Community Bank
Here are some questions you should ask
when choosing a community bank:
How long has the bank been around? If
it’s a public company, can you access
information on the bank’s web site? Does
it pay dividends to shareholders? Are
the rates it offers reasonable or is the
bank desperate for funds and paying
outrageously-high rates. Is the bank
healthy and profitable?
First National Bank has always answered
these questions with complete
transparency, from its beginning in 1963
at the original Daly City branch, through
its steady growth to 13 locations,
including 2 in San Francisco.
You also want to look at two other
fundamental things: capital and liquidity.
Capital (or equity) is the margin that
covers creditors if the bank’s assets are
liquidated. In other words, this is the
primary measure of a bank’s financial
strength. The more capital it has, the more
protection it offers investors, as a cushion
for any kind of operational losses. The
Office of the Control of Currency (OCC)
requires 10% minimum total capital to
risk-weighted assets. FNB is presently
in the 14% range.
Liquidity measures how well the bank
can meet cash and collateral obligations
without occurring unacceptable losses. It
measures whether a bank can fund loans
and support deposit withdrawals. First
National Bank has plenty of liquidity.
FNB Continues Cautious
Loan Policy
FNB is in the risk business and tries to
minimize or manage the risk associated
with every loan.
By knowing the
community and
the people that
work there, it’s
easier to identify
creditworthy
individuals—
a big advantage
over the
mega banks.
3.25%), the rate would be 6.25%. We
look at what happens if prime goes up
to 4% (and the rate to 7.25%)? Would
the borrower still be able to make
that payment?
Join Us for a Complimentary Seminar on
Estate Planning
There is no perfect loan formula.
“However, when you know the
borrower, and you know they are a
quality person, it is a lot easier to make
the right, fair decision,” explains CEO
Tom McGraw.
Presented by: Tim Watson, Attorney at Law
Date: Wednesday, September 9th
Time: 6:30 - 8:00 pm
“The door is always
open—so whether you
FNB
have a 100-dollar
account or a 10-million
dollar account, you can
contact FNB management
anytime by phone or e-mail
with questions and concerns.“
FNB does
exacting due
diligence on every
borrower. For
example, let’s say
that someone
wants to buy a new warehouse and it
costs $1,000,000. On a commercial loan
application, the loan to value is 65%.
For this transaction, FNB will loan a
maximum of $650,000.
Evaluating the credit application involves
a number of things, including three years
tax returns, a CPA audit of financial
statements, and a business plan. There is
also a cash flow analysis to determine if the
cash generated is sufficient to pay the debt.
Next comes a stress test. For a variable
loan at prime plus 3% (with prime at
“We have a vested interest in making
certain that each borrower is going
to be able to make that payment,” he
continues. “What stands out about our
bank, when people get into trouble—as
with every other bank, you have people
that get into trouble—we don’t
abandon those people the minute they
say, ‘Hey, I lost my job’ or ‘My
business is off by 50%.’ We roll up our
sleeves and try to figure out ways to
make this work out successfully.
And with a positive outcome, the
borrower can feel he or she has made it
Place: 975 El Camino Real, South San Francisco, CA 94080
Complimentary
Seminar
R.S.V.P. by 9/2/09 to Liz in Marketing, 650 488-2236 or
e-mail: [email protected]
Refreshments will be served
M
any of us have heard how
important estate planning is
today. People used to think estate planning was only for the wealthy, but that is not true. Today, Living Trusts, Wills,
and Probate are all important considerations in protecting your assets and determining whom your assets will go to upon your
death. These are often topics we do not like to think or talk about; however, if we don’t plan in advance for the distribution of our
assets, they may wind up in a costly probate or worse, not in the possession of those we choose. To provide you with an overview of
estate planning options, Attorney Tim Watson will offer a free evening seminar, on Wednesday September 9, 2009, to discuss these
issues and answer general questions you may have. The evening will begin at 6:30 with an estate planning presentation followed by
a general question and answer session until 8 pm.
You may think you have plenty of time to prepare for the future and while we hope you do, we feel it is never to soon to begin your
planning — please RSVP and plan to join us. n
through a difficult time with the help of
a partner.”
The door is always open—so whether
you have a 100-dollar account or a 10million dollar account, you can contact
FNB management anytime by phone or
e-mail with questions and concerns. Rest
assured that First National Bank of
Northern California is a safe, solid, and
transparent institution that will continue
to take care of you and your money.
(You’ll find Tom McGraw at
650-875-4865 or
[email protected].) n
We’re in it for the
Long Haul
A
t First National Bank of Northern
California, we’ve been through all
kinds of economic instability—
from the stock market crash of 1987 and
the dotcom bubble to current real estate
gyrations. We’re successfully weathering
the current crises just as we have all
the others.
Experienced Management
Part of the reason for our stability is a
senior management team that has been
with the bank for decades. This group has
a high level of experience, along with the
ability to work through difficult issues.
Head of the Loan Department Randy
Brugioni started at FNB in 1991.
Madeleine Lindsay, our compliance
officer, came on board in 1973, and
Chuck Key, head of IT, joined us in
1970. The list goes on: COO Tony
We’ve never played casino banking like
some of the big institutions. “In the good
times, we are criticized because we don’t
push harder. In the bad times, everybody
thinks we’re smart,” says FNB president
Jim Black. n
Loyal Clients
Another thing that helps keep us solid is
our loyal client base. Most FNB clients
find that if they are experiencing a
problem with a loan, they will come to see
us with a solution already in mind. Clients
are not afraid of us—they know we’ll
listen and work with them. This keeps our
asset quality at a higher
level than many other
banks, whose customers
would just as soon walk
away when things go south.
High Level
of Capital
Randy Brugioni
gets. Reasonable pricing and lending, and
a fair return to shareholders. Perhaps,
that’s why we’ve been around since 1963
and continue to function as a safe
depository and a safe lender.”
Clifford in 1983, Bank President
Jim Black in 1982 and Chairman of the
Board Mike Wyman in 1964. CEO
Tom McGraw’s father, Elton McGraw,
was one of the original investors and
board members.
The minimum total capital
of a “well-capitalized bank”
required by the Office of
the Control of Currency
(OCC) is 10%. We are
currently at about 14%.
FNB was not involved
in any highly leveraged
transactions, such as sub prime loans,
derivatives, and hedge funds, and all of
our borrowers are required to have equity
in the transaction. Or, as they say, “skin in
the game.”
Conservative Underwriting
Even in the boom times, we take a
conservative approach to risk. FNB
FNB President, Jim Black
management has been here long enough
to know that down cycles are part of
the economy, and that their length and
duration are somewhat unpredictable.
As a result, we position ourselves
accordingly, not taking on more risk
than we think a traditional economic
cycle will support. In other words, we
keep plenty of cushion.
Back to Boring Banking
We’re not talking about uninteresting
here, but boring in the sense of reliable
and stable—the kind of community
banking that CEO Tom McGraw
wrote about in a recent press release:
“Community banks take local deposits
and loan those dollars to local
deserving creditworthy borrowers.
That’s about as exotic or as sexy as it
George
Venezia
Retires
from
FNBNC
June 25, 2009,
First National
Bank of
Northern California joined together
to acknowledge George Venezia for
both his 15th year Anniversary and
Retirement from FNBNC as VP/
Purchasing & Facilities Manager.
At a dinner in his honor, he was
surrounded by family, friends and
colleagues. Many heartfelt words
and stories were shared about
George which provided much
laughter and tears. Thank you
George, we wish both you and
Joyce all of the best that
retirement brings. n
FDIC Covers up to $250,000
T
he Federal Deposit Insurance Corporation (FDIC) is an independent agency of the United States government that covers all your deposit accounts at
insured banks such as FNB. This includes checking, NOW, and savings
accounts, plus money market deposit accounts and certificates of deposit (CDs)
up to the insurance limit. The FDIC was established in 1933, and since then, no
depositor has lost a single penny of FDIC insured funds.
Increased Coverage
Prior to October 2, 2008, the FDIC
“. . .the basic
insured interest bearing and non
interest bearing accounts up to
coverage limit will return
$100,000 per ownership category.
Insurance coverage for certain
retirement accounts, which
to $100,000 ($250,000 for
includes all IRA deposit accounts,
was increased permanently to
certain retirement accounts)
$250,000 per depositor in 2006.
Beginning October 3, 2008 through
for all deposit categories on
December 31, 2009, insurance
coverage was temporarily increased
January 1, 2014.”
to $250,000. On May 19,2009, Congress extended the temporary $250,000
coverage through December 31, 2013. As of
this writing, the basic coverage limit will return to
$100,000 ($250,000 for certain retirement accounts) for all deposit categories on
January 1, 2014.
The FDIC does not insure the money you invest in stocks, bonds, mutual funds,
life insurance policies, annuities, or municipal securities—even if you purchased
these products from an insured bank or savings association.
No Free Lunch
This FDIC coverage is not free. We pay a substantial fee to offer this secure
environment to our customers—and we have not adjusted any of our depository
accounts to reflect these costs because we do not think passing these costs on to you
is the fair or the right thing to do.
At FNB, we are concerned with providing a safe, secure environment for you and
your money. To find out more, go to www.fdic.gov. n
“The bank has always
been conservative and
stable, yet progressive,
and this explains why
it has been around
for 46 years.”
meeting with several board members.
Next comes a vote of the board, and
finally (if elected), confirmation at the
next annual shareholder meeting. Each
year shareholders reelect the board
of directors.
Meet Another of Our
Board Members—
Ed Watson
B
ack in the mid-1990s, First
National Bank of Northern
California was looking for a new
board member—an outside director who
could provide both legal and accounting
expertise. Ed Watson (a lawyer and CPA)
got the nod. He is managing partner at
Watson & Lanctot LLP, a full service
San Francisco law firm specializing in
estate and tax planning, and probate and
trust administration.
Selection to the FNB board starts with a
nomination, followed by the vetting
process, which includes
The board of directors is responsible for
the overall operation of the bank and
defines its policies and strategic direction.
At the same time, the board safeguards
the investment of the shareholders.
“For me it is a challenging position
because it’s like running a business
from the 30,000 foot level,” explains
Ed Watson. “The bank has always
been conservative and stable, yet
progressive, and this explains why it
has been around for 46 years. It’s well
positioned to weather the current
financial situation, and to continue
serving the local community.”
Ed is a lifelong resident of Burlingame,
has been married to Liz Watson for 37
plus years, and has four grown children,
with one grandchild on the way.
There is a reason they call this the
“Family Bank.” n
Cash Management
Services
First National Bank of Northern California Privacy Policy
We have been
successfully and safely providing a
variety of commercial banking
products and services since 1963. We
have developed a full line of Cash
Management Services that we are
confident will benefit your business,
some of which are listed below.
T
Business Direct: Make deposits from
your office, no more time and gas
spent making trips to the bank.
n
Information we receive from you on applications or other forms;
n
Information about your transactions with us or others; and
n
Information we receive from a consumer reporting agency.
Lockbox Services: Outsource your
receivables processing to us, and save
time processing payments.
ACH Services: Automate your
payroll, other payments and collections
through the use of the Automated
Clearing House Payments Network.
Online Banking: Access Bill Payment
functions and a host of other account
information and online services.
Merchant Bankcard Services: For
entities that accept credit card
payments, why pay high interchange
rates, call for a cost comparison today.
he directors, management, and staff of First National Bank of Northern California are concerned about and
respect the privacy of our customers’ personal financial information. We understand that our customers furnish sensitive information to us in the course of daily business, and we are committed to treating such information responsibly. We know that our customers expect privacy and security for their personal and financial affairs.
TYPES OF INFORMATION WE COLLECT
We collect non public personal information about you from the following sources:
TYPES OF INFORMATION WE DISCLOSE
We do not disclose any non public personal information about our customers or former customers to anyone, except
as required by law or in the course of normal banking business. For example, we provide balance information to
ATM networks so that they are able to release cash to you while you are using another financial institution’s ATM.
SAFEGUARDING CUSTOMER INFORMATION
We restrict access to non public personal information about you to those employees who need to know that information to provide products or services to you. For example, information in loan files can only be accessed by employees
who work in the loan origination or loan operations departments. We maintain physical, electronic and procedural
safeguards that comply with federal standards to guard your non public personal information.
All employees have a copy of this policy and are trained at least annually regarding the importance of safeguarding
customer information. The human resources manager and the appropriate department manager will take disciplinary
action against any employee who violates our Bank’s privacy policy and procedures.
Sweep Accounts: Ensure your funds
are working for you at all times.
If we change our policy or practice by, for example, adding a category of information that will be disclosed to a third
party, we will notify existing customers and give them an appropriate time period to opt out of the disclosure.
In these challenging economic times,
products which offer you value along
with safety and soundness are critical.
The board of directors approved and adopted this policy on November 29, 2000 and amended it on May 18, 2005. n
For more information please contact
our Treasury Management Officer,
Debbie Sanwal at 415-488-2734. n
Photos by Scott Buschman
Photography