Paragon National Bank announced at its seventh annual shareholders’ meeting that it has maintained profitability over the last five quarters.During the recent meeting at The Dixon Gallery and Gardens, attendees listened to CEO Robert Shaw and President Mike Edwards present the bank’s other key accomplishments and financials from last year, as well as the areas of focus for 2012.
Following the completion of official business, Shaw and Edwards reviewed the bank’s progress in meeting 2011 goals, which included aggressively dealing with credit issues, building the core earnings capacity of the bank and increasing loans and deposits through new customer relationships.
Since 2008, Paragon has successfully resolved more than $32 million in nonperforming assets with an 85% recovery rate. Classified assets have decreased 32% since they peaked in 2008 and over the last year,the bank was able to reduce them by more than 21%.
During 2011, Paragon increased its net interest margin from 3.36% to 3.64%. The bank’s core noninterest income increased by 7%, while its core non-interest expense decreased by 5%. Capital ratios have continued to increase without assistance from any government-sponsored programs or loans and as of March 31, the bank’s Tier 1 capital ratio was at 13.85%.
Additionally, the bank focused on repositioning its loan portfolio to include more business lending,resulting in Paragon’s rating as the number one business-lending community bank in Memphis by the U.S. Small Business Administration. Paragon’s allowance for loan losses continues to exceed banks within its peer group.
Paragon’s core deposits have increased and Demand Deposit Accounts (DDA) balances are nearly 16% of the bank’s total assets. Additionally, the bank has seen continued growth in checking account volume,while the total number of those accounts has increased 13%.
“Mike and I couldn’t be more proud of the efforts our board members and team made in 2011,” said Shaw. “Last year, we made it a top priority to reduce our classified assets, while furthering our investment in our customers and the community. Those efforts are directly reflected in our sustained profitability over the last five quarters. In 2012, we’ll continue to place emphasis on substantially reducing our level of classified assets while maintaining a strong capital position and exceeding our operating budget.”
Other highlights for 2011 include the appointment of Lewis Perkins as Chief Financial Officer and Executive Vice President, as well as Paragon’s recognition as the 2011 Corporate Neighbor of the Year by Volunteer Mid-South’s Corporate Volunteer Council. The bank continued its involvement with nonprofit and community organizations, including its donation of more than $11,000 and over 1,000 food items to Mid-South Food Bank during its 4th Annual Student Food Drive. Among the other organizations that the bank supported during 2011 include the Memphis-Midsouth Affiliate of Susan G. Komen for the Cure®, the Make-A-Wish Foundation of the Midsouth and the Memphis Child Advocacy Center.