Letter to Shareholders and Clients
October 15, 2008
I hope this letter finds you well. In light of the unprecedented economic turmoil and fear gripping our markets, I thought it would be most appropriate to once again communicate directly how "your bank" is performing during these challenging times. As you will note in the attached press release we continue to outperform our peers by a wide margin and generate meaningful earnings quarter after quarter, irrespective of how dire conditions have become.
This past quarter marked our sixteenth (16th) consecutive quarter of profitability - quite the accomplishment considering the dismal state of today's financial services industry and the unprecedented strains on our economy. Furthermore, we have achieved such results without incurring undue risk and as a result our loan portfolio continues to perform exceptionally well. Our year to date earnings are among the strongest in our peer group and significantly ahead of plan. The credit for these extraordinary results goes out to our entire team, including our dedicated staff, terrific clients and loyal shareholders.
In just two weeks (October 30th) we will celebrate the 5th anniversary of the Bank. Suffice it to say it has been an interesting journey thus far! While we have met with much success to date, we remain diligent in our approach and will not sacrifice our future results simply in an effort to generate short-term gains. Together we have been built a solid, safe and sound financial institution that has the capital, liquidity, and earnings to withstand the effects of an extended economic contraction.
Our capital levels are nearly twice that needed to be considered "well capitalized" by regulatory definition and as such we have no intent to participate in the government's "bank rescue plan" at the expense of our shareholders. In fact, our capital ratios will still exceed those of all the major banks participating in the plan even after their respective capital injections.
So while the barrage of negative news concerning the economy is sure to continue for some time, rest assured that we will continue to manage the Bank in a disciplined and conservative manner, ensuring that our depositor's funds are not jeopardized and that our shareholders' capital is invested judiciously.
If at any time you have questions regarding the Bank, its outlook, or its performance, please do not hesitate to contact me directly at (619) 525-1727 as I enjoy hearing from you.
On behalf of our entire staff, management team, and Board of Directors, thank you once again for your continued support and confidence in San Diego Trust Bank.
Very truly yours,
Michael E. Perry
President & Chief Executive Officer