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Branching out

Hopewell Valley Community Bank expands its reach in Mercer, Middlesex counties

Melinda Sherwood, Business Editor
   When Hopewell Valley Community Bank first opened its doors in 1999 at Pennytown Shopping Village off Route 31, community banks were becoming an endangered species. Fleet and First Union had just acquired local banks, and only one community bank — Yardville National Bank — was left standing.
   Five years later, approximately four community banks and three national banks serve the Hopewell Valley region — two within spitting distance of HVC Bank’s administrative headquarters opposite the Pennington Market. That kind of in-your-back yard competition might spell disaster for an ordinary business.
   Not so for HVC Bank, which is enjoying significant growth — both financially and geographically. Earlier this month, HVC Bank closed the doors on its original Pennytown branch and ushered in a new era of expansion with the opening of its 4,000-square-foot, full-service branch at the intersection of Routes 31 and 518 in Hopewell Township, former site of the Wawa.
   HVC Bank also has plans to open a fourth branch in the new Hopewell Crossing Shopping Center, currently under construction on Route 31 in the Brandon Farms area of Hopewell Township, in late 2005, and a loan production office in the Cranbury area this fall.
   Ironically, it’s the influx of large banks that has actually helped HVC Bank carve out a niche for itself in the area, says Patrick Ryan, the bank’s founder and chairman.
   "When we started in 1998, the banking landscape was very much in disarray," he said. "Large, out-of-state banks came in and took over a multitude of New Jersey-based banks, particularly in this area. When they came in they disrupted the relationships among the borrowers and the lenders, and the banks and their depositors, by closing branches, shifting personnel around and cutting lines of business. … People would come into our bank holding a cashier’s check with steam coming out of their ears."
   HVC Bank capitalized on its small size and earned a reputation for being service-oriented with competitive products — an interest-bearing checking account for nonprofits, for example — as well as a highly active and versatile loan department catering to the local business community.
   "We are what you would refer to as character-lenders in many instances," said James Hyman, president and CEO. "The first consideration in lending money is the character you’re lending to. Every loan that we look at is looked at with the idea in mind, how do we make this loan? If it can be repackaged, put into a form a little bit different than it starts, how do we fill the need. It’s not just an application form that you complete the boxes and it gets scored someplace.
   "We’re a lending bank — that’s primarily our mission," he continued. "If we’re successful lending money, everything else falls into place."
   Thus far, that philosophy has paid off.
   Between 2001 and 2003, HVC Bank’s deposits rose from $60.9 million to $119.5 million. During the same period, loans increased roughly 70 percent, from 52.7 million in 2001 to 90.7 in 2003. And the bank’s profits have skyrocketed as well, from $180,000 in 2001 to $739,000 in 2003.
   Mr. Hyman, the former president and CEO of First Community Bank of Clinton, chalks it up to good management and good customers.
   "It’s much more than the numbers, it’s the business model — what we’re doing, who we’re serving," he said.
   And in the future, they hope to be serving more people throughout the central New Jersey area, while still maintaining that community bank feel.
   "We’re at an optimum position geographically to go to Hunterdon County and Somerset County and still build a synergy to our branch network," said Mr. Hyman.
   Although they’re branching out, both Mr. Ryan, a former beer distributor, and Mr. Hyman are approaching growth cautiously.
   "We’ll let good opportunities drive us rather than any fixed plan," said Mr. Ryan.
   "It’s about not making excessive financial commitments," added Mr. Hyman. "It’s about growing one step at a time."