Writer: Max Crampton-Thomas
2 min read July 2021 — Professional Bank tends to the financial needs of its clients through personal service and customized products offering a broad array of commercial credit offerings designed for business, in addition to construction lending, residential and commercial real estate. Chairman and CEO Daniel Sheehan spoke with Invest: and discussed the bank’s IPO in 2020, as well as outlining the state of the banking sector in the region.
What was behind the decision to take Professional Bank public?
There were three primary reasons driving the decision, the first of which was to create liquidity for our shareholders. Our first generation investors have been with us since 2008 and we thought it was important for our shareholders to have liquid stock. The second reason was to create further value for our current and future employee-partners. We feel the opportunity for ownership at the bank will continue to serve as a compelling attribute to attract and retain great talent. When hiring, there’s not a better alignment tool than offering the opportunity for ownership and having it listed on a major exchange. The last reason relates to potential M&A. When looking to partner with a bank through a merger, listed stock is a much more valuable currency and is a helpful form of consideration for the deal as it provides liquidity that a seller or partner might be expecting.
Professional Bank completed its acquisition of Marquis Bank in 2020. How successful has that been?
Marquis was a great institution, and we are fortunate to have them as part of the family. Their headquarter location was literally across the street from ours, we shared a handful of clients, and they banked a similar segment of the regional economy that we also targeted, so it was a natural fit. The acquisition has been a success, and the people who have come over have been great.
How have you been able to leverage technology to stay nimble and offer personalized services for clients?
We have an office in Cleveland that serves as our digital innovation center and houses a number of software engineers and other talented individuals that focus on our digital banking strategies. We routinely discuss our evolving view of what the banking industry will look like in the future and what we need to do to stay ahead of the curve. We recently announced that we will be launching an online account-opening feature that can be done from a smartphone in about three minutes, without filling out any paperwork. It’s our sense that people will continue to expect for it to become easier and easier to interact with their money, and we spend a lot of time thinking about that. Ease-of-use is top of mind when we think about the many forms of client interaction. Notwithstanding certain requirements around certain types of transactions, we’ll continue to try to chip away at the friction that typically exists around other routine bank transactions.
How is your commercial banking strategy evolving in regard to the growth that is expected in the market?
Small to medium-size business has been our focal point since we started the bank in 2008. We feel we are well positioned to capitalize on the migration of people and business with their respective capital into Florida. We believe that neither taxes, nor weather is going out of style anytime soon, so we will continue our efforts to hire the best bankers and create the useful digital products with our goal to increase relative market share in our growing market.
How would you describe the current state of the Palm Beach County banking and finance sector?
Palm Beach County has been a popular destination for financial firms relocating from out of state markets. In addition to the several out-of-state banks seeking exposure to Florida, there are non-bank financial firms, asset managers, hedge funds, private equity funds or other financial vehicles that are not depository institutions. The number of depository institutions in Palm Beach County has actually shrunk over the years, while the market opportunity has expanded, which makes Palm Beach County an attractive market from a banking perspective.
Palm Beach County continues to get younger and the economy is becoming more diverse. If you looked at the economy 30 years ago, it was largely geared towards real estate, tourism and local service businesses (legal, accounting and medical), without many large employers. Much of the local wealth was generated elsewhere, and Palm Beach County simply served as a comfortable, fun place to visit and spend money during the winter or spring break. That’s different now as firms are relocating here bringing institutional capital formation, deal origination and the related back-office jobs. The seasonality of business has somewhat flattened a bit due to more people living here year-round which is healthy for a variety of local business types because they can rely on a more steady flow of customers 12 months of the year.
What are your priorities in the short term?
We will continue to partner with great bankers in great markets and maintain a culture that fosters a consistent, positive client experience. We strive for Professional Bank to remain a great place to work while we scale, especially for young people, because I think the banking industry, in general, has done a poor job over the last 10 years at attracting smart young people.
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