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New Bank Thrives in Sluggish Economy

By George Alfano
May 26, 2012

2009 might not have seemed a good time to open a branch of a business bank in the Inland Empire. After forming 1st Enterprise Bank in 2006, CEO John Black didn't stray from the original plan.

Black, who has been in the banking industry for more than 25 years, formed 1st Enterprise in 2006. The bank opened their Inland Empire branch in Ontario in 2009, and Black said the institution has not suffered any loan losses in their six-year history.

"The Inland Empire was part of our plan from the beginning," said Black, who worked for Mellon First Business Bank before forming 1st Enterprise.

"We have high-quality small to mid-size businesses which haven't been overwhelmed by the housing problems. There are still a lot of good companies that have the right person leading them."

Black would rather bring his financial institution to his business customers rather than waiting for people to visit his offices. He brought a team of experienced bankers to the new entity.

"Business leaders have access to senior decision makers, and every business has an assigned manager who almost always has over 10 years experience," said Black.

"We act as a consultant to our business clients and help them structure banking to meet their financial needs."

The assets under management for the period ending on March 31 is $579 million, an increase of $70 million from March 31, 2011. 1st Enterprise has 68 employees, including seven in the Ontario office. Black said the annual revenue for client businesses ranges from $5 million to $75 million.

Since 1st Enterprise isn't well known by the general public, most business comes from referrals. The three largest categories of businesses are manufacturing, construction and logistics. David Whitehead, whose firm manufactures cabinets, doors, frames and hardware for commercial construction, was connected with 1st Enterprise when he needed a larger line of credit.

"We waited six months to get a decision on a larger credit line," said Whitehead. His firm, Roy C. Whitehead Inc., has been in business since his father founded the firm in 1955.

"A small business can't wait six months for a decision. As tough as construction is, the only jobs that are going on are big jobs. The last thing general contractors want is somebody to gum up the works. We need to meet their expectations."

What might be surprising was that Whitehead, who found out about 1st Enterprise two years ago from his accountant, obtained a larger credit line. This has allowed his business to make more money because business can be done quicker.

"With a larger line of credit, we are able to buy further in advance for materials," said Whitehead, whose business had revenues of $18.5 million in 2011 and is on track to match that number this year.

"Most vendors allow a discount, and this is a profit center because we save more in discounts than we pay for the costs of the loan."

Keith Cerwinski said Whitehead is an example of a business which fits the profile of clients the bank desires. Cerwinski, a regional vice-president who joined the bank when it started, is familiar with Inland Empire business and works out of the Ontario office.

"We're not a big bank and we don't want to be big," said Cerwinski, who grew up in Upland.

"In 2009, the financial crisis affected businesses all over the country. Anybody can go out when times are good. There will always be excellent business operators who are strong, and we want to lend to them."

About 1st Enterprise Bank

Founded in 2006, 1st Enterprise Bank is a full service independent commercial banking institution, whose highly experienced bankers personally serve Southern California entrepreneurial businesses, professional firms and nonprofit organizations, along with their owners and key managers. Headquartered in the Los Angeles financial district, with full service regional banking offices in Irvine and Ontario, 1st Enterprise Bank offers a full range of credit and depository services, with special emphasis on superior customer service, sophisticated cash management services and direct access to bank decision makers. Customers work directly with a dedicated Relationship Manager, a seasoned professional who understands their unique challenges serving as a sounding board and an active participant in their client's success. For more information on 1st Enterprise Bank, please visit www.1stenterprisebank.com.

Forward-Looking Statement:

The statements contained in this release that are not historical facts are forward-looking statements based on management's current expectations and beliefs concerning future developments and their potential effects on the Bank. Readers are cautioned not to unduly rely on forward-looking statements. Actual results may differ from those projected. These forward-looking statements involve risks and uncertainties, including but not limited to the health of the national and California economies, the Bank's ability to attract and retain skilled employees, customers' service expectations, the Bank's ability to successfully deploy new technology, the success of branch expansion, changes in interest rates, and loan portfolio performance.

John C. Black
Chief Executive Officer
Copyright 2012, 1st Enterprise Bank, Inc. All rights reserved.