Encore Performance

Encore Performance

Jerry Campbell founded one of Michigan's largest banks before selling it. He has started HomeBanc on the Gulf Coast with statewide visions

Don't blame Jerry Campbell if he is having a feeling of dejà vu.

Campbell is chairman and chief executive officer of HomeBanc, a startup bank in Tampa working its way into the Gulf Coast, with branches in Tampa, Sarasota and Lake Mary and loan-processing offices in Brandon, Lake Mary and Bellair Bluffs.

Before this, he founded and ran Republic Bank, based in Ann Arbor, Mich., and grew it into Michigan's second-largest bank before selling it to Citizen's Bank for $1.1 billion in 2006. Part of the purchase contract restricted Campbell's banking activity in Michigan.

But he was very familiar with the Gulf Coast, spending vacations at his condominium in Clearwater for 25 years.

"I was open to anything after the sale," says Campbell, 68. "I decided I was ready to retire."

Typical of many achievers, that lasted four months. Campbell started a new bank charter in April 2007 in Florida, and with the help of 150 investors, raised $45 million to start HomeBanc. It set up a headquarters in downtown Tampa.

HomeBanc's short-term plan is to open locations between Tampa and Sarasota on the Gulf Coast and open a few branches in Orlando. It has branches under construction in Bellair and Oldsmar which are set to open in the fourth quarter or first quarter of next year.

HomeBanc, which has 80 employees, is a hybrid, but sees itself more as a commercial bank. Its branches have no tellers. It does single-family mortgages and SBA loans. It does no consumer loans, but does do some home-equity loans and offers a popular 5% money market account.

Campbell describes the bank's numbers as "fine and awful." That's because it is spending a significant amount on expansion.

It has $45 million in capital and $85 million in assets. But since it has been building and opening new branches, it is losing money. It has no positive return on assets or positive return on equity. HomeBanc plans to break even late next year on a monthly basis and be profitable in 2010.

New offices are key because building core deposits is important. HomeBanc wants to build a strong retail depository base, so that's how it is using assets. It is not an Internet bank, so it needs a presence in good markets. It is trying to build a retail grid of convenience. To have a presence, it needs high visibility.

For example, its locations at Dale Mabry and Interstate 275 and on Rocky Point are a good way to be seen by motorists. Campbell doesn't see the bank's strategy changing. It will remain mainly a commercial bank that does quality home loans. The bank has done more than $80 million in single-family home loans in Tampa this year.

He admits this was the identical strategy with Republic. Why reinvent the wheel? "We've got a blueprint," Campbell says. "We're dusting it off and trying to do it again."

Campbell sees banking as a people business that starts with happy, successful employees. Fortune magazine ranked Republic Bank one of the 100 best places to work for six straight years.

How does he retain good employees? Primarily by surveying them, treating them with respect and using a pay-for-performance system.

Most employees are salaried and some have the ability to make commissions and bonuses, too.

Campbell's main lessons learned as a CEO are the importance of learning how to recruit, train and motivate good people. At HomeBanc, every employee has a written performance plan and reviews it monthly with management. That way, employees are never unsure about their progress.

In light of the subprime loans crisis and real estate slump, HomeBanc does no loans for speculative construction. Since it was not operating during the time of the problem mortgages, HomeBanc is free of that bad debt.

Campbell is competitiveness extends from the staid industry of banking to the flash-and-dash of horse racing. He has been raising and racing horses for years in 10 states and has won more than 1,200 races.

- Dave Szymanski