CresCom Bank reports significant net income for 2015, predicts Myrtle Beach area will continue growth

CresCom Bank and its holding company Carolina Financial Corp. reported significant gains in net income for 2015, and top executives credit that growth to strong markets including the Myrtle Beach area, which they predicted will continue to thrive this year.

“We’re prepared for South Carolina to have a good year,” David Morrow, president and CEO of CresCom Bank said Monday. “There’s still a lot of industry coming to South Carolina -- there’s a lot of positive things happening to our state over the years. We have always been looking up at our sister states. Quite frankly, they’re looking up at us right now.”

“The growth in industry in South Carolina has been tremendous, so we think the markets we’re in, the coastal markets in particular just because of the opportunity for real estate growth” will continue to prosper, Morrow said.

CresCom Bank, which has three locations in the Myrtle Beach area, reported a net income of $11.4 million for 2015, compared to $7.3 million for 2014.

Charleston-based Carolina Financial Corp. reported a net income of $14.4 million in 2015 compared to $8.3 million in 2014 -- a 74 percent increase, said Jerry Rexroad, chief executive officer of the corporation. That’s $1.48 per diluted share for 2015, compared to 87 cents per diluted share in 2014.

“From Charleston through the Grand Strand, we’ve had very solid growth,” Rexroad said.

The financial institution is also growing in acquisitions, and on Jan. 6 announced a deal to acquire Congaree Bancshares, Inc., the holding company for Congaree State Bank in West Columbia. Morrow said the acquisition is pending approval by federal regulators, but is expected to be complete this summer.

Rexroad said Carolina Financial, the second largest bank in the state, is following in the path of banks nationwide that are expanding by acquiring other financial institutions, rather than building new branch banks.

“We believe there’s some real advantage to being what we would call a large community bank -- somewhere between $2.5 and $5 billion -- small enough to still know your customer and provide that hands-on and personal attention, at the same time you have to be big enough to cover the regulatory costs that have been put down on the industry as a result of Dodd-Frank,” Rexroad said.

The Dodd-Frank legislation imposed massive new regulations on the financial industry and was passed by Congress in 2010 in response to the recession. It was intended to target larger banks, but banks of all sizes were swept into the omnibus bill that President Barack Obama eventually signed into law.

New disclosure rules from that legislation took effect in October, impacting real estate sales as well as mortgage lending.

“Quite frankly, I think it’s still having an impact,” Rexroad said.

Rexroad said the Dodd-Frank implications were evident in their fourth quarter earnings, although net income for Carolina Financial Corp. was $3.6 million in 2015, compared to $1.7 million in 2014.

“It’s been a challenge for the industry as a whole,” Morrow said.

This story was originally published January 25, 2016 at 5:00 PM with the headline "CresCom Bank reports significant net income for 2015, predicts Myrtle Beach area will continue growth."