Fresh off a stellar first quarter, People’s Bank of Commerce has opened the doors at its new $6.5 million home office on Biddle Road.
Although the second-floor administrative center and third-floor executive offices won’t be ready until May at the 20,000-square-foot headquarters, tellers and lenders are greeting customers at the one-time site of Marie Callender’s Restaurant.
Natural light pours into the building designed by OgdenRoemerWilkerson Architecture from three sides, and the executive offices and board room offer commanding views of the surrounding mountains.
The project led by Adroit Construction cost about a third more than the previous three-story headquarters building on Barnett Road, President and CEO Ken Trautman said.
“Some of that is the subcontractor increases and the cost of materials,” he said. “Land was comparable, about a million dollars at Barnett and a million here.”
With a new financial center going in, and remodels of nearby properties, additional economic development could follow.
“I think this will start a trend,” Trautman said. “There is some stuff over here that is beyond its useful life that would be great to transition. Maybe this will cause someone else to take a look at it and say this is an up-and-coming area.”
People’s Bank financial performance continued its upward momentum during the first quarter, reporting net income of $724,000, or 26 cents per share, compared to earnings of $528,000, or per share earnings of 23 cents, a year ago.
During the first quarter, People’s Bank increased loans 10 percent to more than $216.8 million from $197.7 million a year earlier; deposits jumped 16 percent to more than $280.8 million from nearly $242.9 million; while assets gained 17 percent to more than $318.8 million from almost $271.5 million.
Stoked by last summer’s acquisition of Steelhead Finance, non-interest income soared 198 percent to nearly $1.55 million. The factoring unit netted nearly $1.1 million.
At about $14 per share, the bank’s shares are trading at the highest levels since the Great Recession. After hitting the all-time high of $19.90 Dec. 4, 2006, People’s Bank stock took a lengthy plunge, troughing Aug. 21, 2009, at $4.31.
Despite the turnaround, there’s work to do, Trautman said.
“Really, we don’t dominate our own markets yet,” he said. “A community bank headquartered in a town ought to have 20 percent market share.”
According to the FDIC market share report for 2017, People’s Bank had 7 percent of the Jackson County market share.
“We have room for growth in every one of the communities we’re in,” Trautman said.
On the heels of opening its new office in Klamath Falls this winter, Trautman indicated the bank is looking to enlarge its footprint.
“We’re going to expand geographically,” he said. “We’ll look farther north. We want to be in communities that react a little differently. Right now, when there is a downturn, Medford, Grants Pass, Klamath and Bend react the exact the same way; Eugene, Portland, Albany and Salem, a little different.”
California hasn’t been on the radar, but mergers and acquisitions sometimes open doors.
Richmond, California-based Mechanics Bank announced in February it will acquire the parent company of Scott Valley Bank, which has operated an office in Medford since 2011.
“It’s a different beast,” Trautman said. “But that might open up something down there.”
Branch offices will be added judiciously.
“We’re way on the south end of Ashland right now, and we might need a small office downtown,” Trautman said. “Those merchants have cash, and have to go to the bank, and they don’t want to drive, because if they give up their parking spot, they lose it.”
People’s Bank will continue branch and mortgage operations at its Barnett Road office. But it will likely lease the 7,000-square-foot third floor.
“We’re going to get moved out, clean it up, and get serious on the decision of how to use it,” he said.
Down the road, if People’s Bank continues to grow at its current trajectory, there might be more construction, Trautman said.
“If we’re in a situation five years from now that we’re twice as big and we need to grow, I’d probably prefer to be downtown Medford next time,” the CEO said. “They’ve done a great job down there at (One West Main), and I think we could help. It would be backroom stuff.”
Reach reporter Greg Stiles at 541-776-4463 or firstname.lastname@example.org. Follow him on Twitter at www.twitter.com/GregMTBusiness or www.facebook.com/greg.stiles.31.