🔒New Haven Bank eyes brick-and-mortar, services expansion in 2022

In the world of banking, the 11-year-old New Haven Bank is a mere baby.

Yet, it's already making its mark as the only locally-owned bank in town. And it’s doing it with a throwback style of approachable, community-focused banking.

Maureen Frank, the bank’s president and CEO, balks at characterizing the approach as “old school,” saying she doesn’t want even a hint that the institution is anything but tech savvy, 21st century-oriented and forward leaning.

The operation got its start in 2010 when a distinguished set of directors — including longtime New Haven Mayor John DeStefano Jr. — formed Start Community Bank.

In 2019, a rebranding brought the current name, which better reflects the way New Haven Bank sees itself and its connection to the community.

Now Frank is firmly focused on what lies ahead in 2022.

“It’s a push year,” she proclaimed before ticking off a series of steps designed to supercharge the bank’s growth:

• There’s a bold move into new geography;

• There’s a plan to expand digital marketing;

• There are explorations with financial technology firms about forming partnerships that could propel the bank into the mortgage business, other consumer lending and perhaps even selling insurance;

• And there’s a push to develop a succession plan, both for officers and the board of directors, that assures an independent future.

It’s a busy agenda for an uncertain time and a lot of work for her modest staff of 21.

Frank acknowledged the pandemic has cast a pall over business across most of 2020 and 2021. She hopes better days are at hand and she’s eager to get on with building on New Haven Bank’s unique platform.

Small business sweet spot

The bank holds a commercial charter yet is a certified Community Development Financial Institution. The distinction labels New Haven Bank as a mission-driven institution committed to serving economically-distressed communities.

There are some credit unions and loan funds in Connecticut that hold CDFI certification, but there’s only one bank.

CDFI is a program of the U.S. Treasury, which makes grants to member institutions but only if they do 60 percent of their business in economically-distressed areas.

Even in wealthy Connecticut, that leaves New Haven Bank with a fertile field, Frank said. But it does require some diligence.

In identifying expansion opportunities beyond New Haven, Frank is focused on West Haven and Hamden. Each offers the kinds of small businesses that form the sweet spot of the bank’s commercial lending portfolio. And there are many multifamily housing units that Frank sees as a growth opportunity for the bank’s upcoming mortgage push.

With assets of less than $200 million, New Haven Bank has built a portfolio of small business loans that average between $300,000 and $400,000. That’s a range that’s worked well for small construction firms and some retail operations.

The bank dove headfirst into the federal Paycheck Protection Program and wrote $33 million in loans to about 300 small businesses that couldn’t get the attention of larger banks.

“We worked with everyone who called,” Frank said, noting that about 50 percent of the loans were written for businesses that had no prior relationship with New Haven Bank.

The first wave of PPP loans has been forgiven by the federal government and Frank said she expects the second wave to be cleared from the books in the first quarter of 2022. The bank never had any risk exposure, she notes.

One of the other sweet spots for the bank is the nonprofit sector. Larger banks often shy away from nonprofits as complex customers that demand too much time and special handling. New Haven Bank sees that kind of customer as an opportunity.

It’s all part of the bank’s community-friendly approach, and nonprofits fit well with the bank’s CFID mission of serving economically-distressed markets.

Frank said she sees a potential fit between nonprofits seeking to build low- and moderate-income housing and the bank’s interest in financing such projects through a third-party partner.

Search for new branches

Exploring the range of fintechs that can supply complementary services is high on the list of goals for 2022.

So is expanding the bank’s retail footprint.

A plan to open a branch in West Haven was upended in September when the lessor decided to use the property himself rather than lease it. So, it’s back to square one as brokers scour both West Haven and Hamden for the right rental property. An ideal spot would be at the end of a strip mall, with a drive-through lane option.

While West Haven had been in the lead, the race is now up for grabs. Once the property deal is done, it won’t take long to work through permitting, outfitting and marketing.

Frank said she is feeling some pressure to get a new branch open by July 1.

“I promised the board,” she said, only half in jest.

The second new branch could follow six to nine months later.

At age 66 with 44 years in banking, Frank has the right kind of background for leading a bank that stakes its claim to being a throwback community bank.

She learned banking skills at Center Bank in Waterbury where she had worked her way up to an executive vice president role.

After that bank was sold in 1996, she did some consulting work before landing the CEO job at Apple Valley Bank in Cheshire. She joined New Haven Bank as a consultant before being named president and CEO in 2012.