Invest: Miami speaks with Israel Velasco, Florida Region Executive

One of our goals at Popular Community Bank is to maximize profitability while using fewer resources. To accomplish this goal, we are focusing intently on markets where we know we have the greatest competitive advantage. In 2014, Popular Community underwent a major restructuring, selling off its operations in California, Chicago and Orlando, leaving those in New York, South Florida and Puerto Rico. While we continue to function and present ourselves as a community bank, we have the benefit of a large, deep-pocketed parent company, Popular Inc. We access the extensive re- sources of our parent company to streamline and enhance our operations, particularly in the area of compliance. In this sense, we like to think of ourselves as a “super community bank.”

Looking forward, the sectors that will drive the growth of the local banking industry are those of commercial and industrial real estate, aviation and import/export. Following a “hub-and-spoke” model, our South Florida growth strategy will rely on the acquisition of branches, rather than opening new ones. Given today’s regulatory climate, it is difficult for new bank charters to be awarded. Along with growth in the sector, there will also be continued consolidation. More regional and so-called “big banks” will enter the market, and community banks will have a hard time remain- ing afloat, given the soaring costs of compliance.

Despite these challenging constraints, there will continue to be a place for community banks in this market. While larger banks have the advantage of more assets and technology, this does not mean they are necessarily more competitive when it comes to providing a high level of care and paying close attention to customer service. Despite the trends towards increased mobile banking and electronic transactions, at the end of the day, banking culture, especially in South Florida, is still very much “high touch”—that is, clients like to see and know who their banker is and we can provide that.