Dear Shareholders and Clients,
Entering the second half of 2013, we are pleased to report continued asset growth and profitability year-to-date along with some exciting news from the Board of Directors.
Second Quarter 2013 Performance:
As of June 30, 2013, Sovereign Bank reported total assets over $1.08 billion, exhibiting total asset growth of more than 19% since June 30, 2012, and reporting exceptional loan growth of 24% on an annualized basis for fiscal 2013.
These numbers have the bank on track to reach our aggressive projections for growth in 2013 as Sovereign maintains our quest to capture market share while also continuing to “grow into” our capital investment in the Houston market.
A major emphasis for Sovereign remains increasing our commercial and industrial loan portfolio. The bank has been highly successful in this endeavor to date, and we greatly appreciate the ongoing referrals from our clients and shareholders as we continue building this important part of the bank. Included in this “C&I” lending initiative is Sovereign’s focus on growing our Small Business Administration (“SBA”) lending efforts. The bank has achieved excellent results on this front, becoming a Preferred Loan Provider in 2012 (the highest level a bank can achieve in the program) and realizing significant fee income from this line of business.
Board of Directors Updates:
Prior to the 2013 Annual Shareholders Meeting, several changes in Sovereign’s corporate governance were implemented. These actions included:
- The roles of Chairman of the Board and Chief Executive Officer were separated.
- Thomas Mastor continues his role as CEO and leader of the bank and holding company.
- Richard Hill accepted an appointment as Chairman of the Board.
- To ensure the Board remains a highly independent entity moving forward, two board members who were “inside directors” (current senior officers of Sovereign Bank) volunteered to resign from board service.
- Michael Russell (Chief Financial Officer) and Donnie Williams (Austin Area CEO) continue to maintain their key roles within the organization.
- Thomas Mastor remains on the board as the only inside Director.
In light of the resignations of Mike and Donnie, the Board recognized the need to add two new outside directors and has now completed a thorough process to fill these roles with optimum candidates. After an exhaustive search process over a number of eligible candidates, we are excited to announce the addition of Board members: T.J. (“Skip”) Falgout, III and Darryl J. Silvera.
Mr. Falgout brings a strong legal background to the Board with a specialty in mergers and acquisitions as well as experience as CEO and Chairman of the Board of America’s Car-Mart, the largest publicly traded automotive retailer in the United States focused exclusively in the integrated sales and finance segment of the used car industry.
A practicing attorney in the DFW area, Mr. Silvera started his own law firm approximately twelve years ago. Headquartered in Dallas, The Silvera Firm provides a broad range of legal services for clients from a wide variety of industries and ranging from Fortune 500 companies to smaller, independent businesses.
More extensive biographies for both Mr. Falgout and Mr. Silvera are posted on the banksov.com website.
We are grateful these gentlemen have agreed to serve, and we firmly believe Sovereign’s Board is the strongest it has ever been. Moreover, the bank continues to report a well-capitalized balance sheet, clean loan portfolio and impressive profitability as second quarter 2013 marked our 30th consecutive quarter of profitability.
Sovereign Bank is thankful for our clients, our shareholders and our employees. It is through the combined efforts of each of these groups that the story of Sovereign remains one of remarkable success. Thank you for your business, your referrals and your encouragement.
Richard S. Hill