Carlsbad’s Capital Bank Loses Two Top Executives
The president and chief executive of the fledgling Capital Bank of Carlsbad on Monday announced his resignation just six months after the bank’s opening.
Edward E. Schmidt said he has received an “excellent offer” from an unidentified company outside the banking industry that “a small, independent bank couldn’t be expected to match.”
Assets at Capital Bank, a subsidiary of Coronado-based Crown Bancorp, have ballooned from $4 million to $9.8 million since the bank opened in December. The bank turned a profit of $6,300 in May, a loss of $500 in April and a profit of $11,000 in March, according to Schmidt.
Schmidt said he will identify his new employer later this month. In the meantime, Capital Bank Chief Financial Officer Richard Cummings will serve as interim president.
Also resigning from Capital Bank was Joseph E. Holt, senior vice president of loan administration, who has moved back to South Carolina for personal reasons, bank officials said Monday. Holt has been replaced by Ronald E. York, a 21-year veteran of Bank of America. York most recently served as manager of the Bank of America Encinitas branch.
The resignations follow by less than one week Crown Bancorp’s reported net loss of $261,000 for the first quarter ended March 31, the first quarterly loss in Crown’s six-year history.
Officials said the loss reflected the $284,000 in loan losses written off in the quarter and the increase in loan loss reserves from $250,000 to $300,000.
Part of the loss was attributed to start-up expenses of Capital Bank and to legal costs associated with a federal investigation into possible drug money laundering at the San Ysidro branch of Crown’s Bank of Coronado.
Schmidt said that his departure was “not related to any management differences” and that his decision was “purely based on opportunities that have come to me.”
If there were management concerns, he said, “then my move would have been to another financial institution.”
Indeed, Crown Bancorp officials said Monday that Schmidt will remain on Capital’s board of directors and that he is expected to be elected a director of Crown at a special board meeting today.