President’s Message OCBI at Mid-Year 2017
I am pleased to report strong performance (for the six-month period ended June 30, 2017 in many of our key financial metrics for Orange County Bankcorp, Inc. (OCBI)—which includes our two wholly owned subsidiaries—Orange Bank & Trust Company (the “Bank”) and Hudson Valley Investment Advisors, Inc. (“HVIA”) on a year-to-date and year-over-year basis.
Key year-over-year financial results include loan growth of 9%, deposit growth of 15% and a resulting increase in Net Income of 39%. Our results through June 30th compare favorably with year-end 2016 results, as the bank has continued to enjoy strong deposit growth, though loan demand has slowed considerably and loan balances are flat as a consequence. This has resulted in an increase in excess deposits of 16%. These deposit and loan results are attributable to growth throughout our operating region, but particularly in our new markets of Rockland and Westchester counties where we have seen steady growth since our office openings in these new markets.
Our Rockland headquarters opened this spring after operating out of temporary space for nearly two years. During this time, Regional President, John Bartolotta, and senior banker, Greg Sousa, established Orange Bank & Trust as a prominent Rockland County financial institution, securing more than 100 client relationships.
We recently opened our fourth Westchester office in Mt Vernon. We believe our strong business and non-profit capabilities make this an ideal market for the Bank, as Mt Vernon is home to significant opportunities for both. We also hired a highly experienced relationship manager, Patrick Smith, to lead our business in this market, while Regional President Joseph Ruhl coordinates our overall Westchester County strategy. Joe has also continued to attract clients based on his extensive experience with legal industry related businesses.
To capitalize on a growing market with tremendous potential, we have assigned a dedicated Market Manager, Diane Passaro, to lead the Bank’s business in Newburgh. Diane has extensive lending, trust and business banking experience and knows the market well. Under her leadership, our goal is to become the dominant bank in the greater Newburgh area as its business community continues to grow.
Our asset management business, HVIA, based in Goshen, continues to grow, with Assets Under Management (AUM) on June 30, 2017 of more than $700 million, up 13% versus 2016 year end. Additionally, our HVIA Mutual Fund, which we launched in October of 2016, grew to more than $12 million under management as of June 2017.
Last summer we announced a major new initiative intended to leverage and connect the Bank’s four core businesses – deposits, loans, asset management and trust & estate. This service is intended to give coordinated and dedicated attention to individuals who maintain significant banking business with us. Moreover, we expect to attract new business from entrepreneurs, business owners, and individuals in the greater Orange County area who feel their companies or unique financial circumstances require a greater level of personal attention and knowledge of their needs.
Trust services have clearly been part of the Bank’s business – and name – since its inception, and we believe we are well positioned to excel with this tailored, highly customer-service oriented approach to banking.
We are also marked our 125th year in business. The Bank’s history is rich with significant contributions to growth in the region, including our status as the only Middletown area bank to have survived the Great Depression. Today, Orange Bank & Trust holds nearly $1 Billion in assets and employees some 150 people throughout our operating region. We remain focused on leveraging our core expertise as a business bank to responsibly deliver income growth, while continuing to earn your confidence as investors, customers and friends of the Bank. Thank you for your ongoing support!