Bank of San Diego President Resigns Over Strategy Issue
The Bank of San Diego, which last week turned operating control over to Chairman James E. Brown, on Wednesday said that President and Chief Executive E. Lynn Caswell had resigned because of disagreements over the bank’s future.
Caswell, who became chief executive in 1984, lost his spot on Bank of San Diego’s board of directors two weeks ago when BSD Bancorp, the bank’s sole shareholder, elected a new slate of directors.
The board election was spurred by “disagreement among the members of the board concerning the future direction of the bank,” according to BSD and Bank of San Diego Chairman Brown.
Caswell and other board members who were not reelected two weeks ago were at odds with the holding company over how much capital and time would be needed to stem the flow of red ink, according to a banker familiar with Bank of San Diego.
The Bank of San Diego has been operating under a regulatory order to increase its capital-to-assets ratio to 7%. The ratio was 5.2% on Dec. 31. The bank recorded a $985,000 net loss for 1986 after reporting a $74,000 net profit for 1985. Assets as of Dec. 31 totaled $371.9 million, up from $322.3 million in 1985.
Company officials on Wednesday declined to describe how the bank would more effectively deal with the problem loans that have sapped the earnings of Bank of San Diego and BSD during the past 2 1/2 years.
Promised Fast Action
However, after the recent board election, Brown promised to “move quickly to make whatever additional changes are necessary to bring (the bank) back to a position of profitability.” Brown was to have met last week with the new board to “set new goals and assign operational responsibilities.”
BSD Chief Operating Officer Vito J. Guarino Jr., who was elected two weeks ago to Bank of San Diego’s board, will serve as interim president and chief executive. Before joining BSD, Guarino was president and chief executive of Mechanics National Bank in Bakersfield.
Bank of San Diego’s board now includes members who also serve on the board of BSD, the holding company, or on the boards of BSD’s various banking subsidiaries. The publicly owned BSD holding company owns five bank subsidiaries and a data-processing operation.
Caswell will “pursue other career opportunities,” according to BSD.
