Santa Lucia Bancorp, parent company of Atascadero-based Santa Lucia Bank, will no longer pay a cash dividend to shareholders, a move designed to bolster its capital in uncertain economic times, bank officials say.
The bank will issue a 2 percent stock dividend on Oct. 20 to those listed as shareholders on the company’s books as of next Wednesday.
“This stock dividend will represent a change in the form of dividend payment to our shareholders away from a cash dividend, which we have paid out over the past 20 consecutive years,” said Douglas Filipponi, vice chairman of the board.
John Hansen, president and chief executive officer, said the bank remains financially sound and is well-capitalized according to federal regulatory standards.
Never miss a local story.
Earnings, however, have been affected by several factors, including the Federal Reserve’s interest rate cuts, which have squeezed banks’ net interest margin, Hansen said. The net interest margin is the difference between a bank’s interest income (the interest it charges for loans and other investments) and its interest expense (the interest it pays for deposits and other borrowings).
As well, Hansen noted that the bank has had to add to its loan loss allowance and has been subject — as all banks have been — to special assessments levied by the Federal Deposit Insurance Corp.
“By paying stock dividends, shareholders will continue to enjoy annual earnings on their investments by adding to their holdings or selling the stock dividend shares received in the market as they choose,” Hansen said.
At the same time, he said, declaring the stock dividend would help the bank continue to accumulate capital.
The company’s net income for the six-month period ending June 30 was $468,000, down 48 percent from the same period a year ago. The company had total assets of $272 million for the six-month period, up 9.2 percent from the same period in 2008, and $232 million in total deposits, up 11 percent from the same period the previous year.
— Julie Lynem Chamber looking for green nominees
The San Luis Obispo Chamber of Commerce is seeking nominations for its 2009 Green Awards.
The honor is given to businesses, organizations and individuals who demonstrate environmentally sound practices. Six awards are given.
Finalists will be chosen on the basis of environmental impact and sustainability, innovation, business benefits, transferability to other businesses and leadership.
“Many local businesses are taking strides to not only be profitable but to consider their environmental footprint,” said Tim Williams, CEO of Digital West Networks and chairman of the chamber’s Sustainability and Resources Committee. “We want to celebrate these businesses as role models.”
Joining Williams as judges will be John Ewan, a former San Luis Obispo councilman and co-owner of Pacific Energy Co.; Erik Justesen of RRM Design Group; Karen Merriam of the Santa Lucia chapter of the Sierra Club; Wende Pearson David of The Land Conservancy of San Luis Obispo County; Penny Rappa of Habitat for Humanity of San Luis Obispo County; and Todd Ventura of Poor Richard’s Press.
Nominations are due by Oct. 15; winners will be announced at a luncheon later this fall. Nomination forms can be found at www.slogreenbusiness.com. Nominees do not have to be chamber members.
Sponsors of this year’s awards are Pacific Gas and Electric Co., Digital West, the city of San Luis Obispo, First Solar and Pacific Energy.
— Tribune staff report