December 31, 2009
To our valued Piscataqua Savings Bank customers,
With the ongoing turmoil in the nation’s financial markets I felt it important to provide you with some information to answer questions you may have about the financial condition of Piscataqua Savings Bank.
What type of loans does the Bank have in its loan portfolio?
The Bank’s loan portfolio is comprised of home mortgages throughout the Seacoast area surrounding Portsmouth. We did not write any of the subprime loans that have been undermining the country’s credit markets. Because we have a direct and vested interest in our customers’ ability to afford their mortgage, we are diligent in our effort to write loans that are realistic for our borrowers. We take that responsibility seriously for the benefit of our customers as well as for the Bank itself.
Does the Bank have a significant level of delinquent loans?
As of December 31, 2009, the Bank’s loan portfolio of $153.3 million had only twelve (12) loans that were one or more payments past due. This very low level of delinquency reflects the Bank’s prudent and common sense to loan underwriting and the relative strength of the Seacoast economy and real estate market compared with other parts of the country.
Does the Bank have any “bank-owned property” or any pending foreclosures?
The Bank has no “bank-owned property;” nor do we have any mortgages that are in the process of foreclosure.
How financially strong is Piscataqua Savings?
The Bank is very solid. The Bank’s capital (or, net worth), as of December 31, 2009, was $34.1 million. On a percentage basis, Piscataqua’s capital strength is among the highest in the state of New Hampshire. In times like these it is reassuring that we are not highly leveraged and have been conservative in our growth to maintain this level of financial strength.
What kind of investments does the Bank have?
The Bank’s investment portfolio is comprised of 95% in bonds directly guaranteed by the US Government. We have no investments in the stock market. We did not have any Fannie Mae or Freddie Mac common or preferred stock. The only “stock” held by the Bank is a non-marketable investment in the Federal Home Loan Bank of approximately $717,000. This investment allows us access to correspondent banking services.
Does Piscataqua Savings Bank have any plans to change the way we do business?
The Board of Trustees and management are very committed to preserving the Bank’s independence. The Bank was chartered in 1877 as a “mutual savings bank.” This form of corporate structure was designed to allow the Bank to operate exclusively for the benefit of its customers. Furthermore, as a “mutual” we do not have stockholders that own the Bank; therefore, we are not at risk of being taken over by another institution.
How can I be sure that my deposits at the Bank are FDIC insured?
The “basic” amount of FDIC insurance per depositor per insured bank is $250,000. Certain accounts such as Individual Retirement Accounts (IRAs) are insured up to $250,000 per depositor per insured bank. With that said there are varying categories of ownership, such as joint, living trusts, and payable-on-death accounts which can substantially increase the level of FDIC coverage. If you have any questions regarding the level to which your accounts are insured, please ask to speak with one of our officers.
As always, if you have any banking questions, please do not hesitate to stop by my office or give me a call.
Jay S. Gibson