STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CARROLLWOOD STATE BANK, )

)

Petitioner, )

)

vs. ) CASE NO. 78-1692

)

SUN BANK OF TAMPA BAY AND )

DIVISION OF BANKING, )

)

Respondent. )

)

REPORT

Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, on December 20, 1978, in the Tampa Chamber of Commerce Board Room, Tampa, Florida. The purpose of the hearing was to receive evidence concerning the application of the Sun Bank of Tampa Bay to open a branch banking facility at the southwest corner of Stall Road and Dale Mabry Highway in Tampa, Florida.

APPEARANCES

For Petitioner: J. Riley Davis

Taylor, Brion, Buker and Green Post Office Box 1796 Tallahassee, Florida 32302

For Respondent Nicholas Yonclas

Sun Bank: Akerman, Senterfitt and Eidson

Post Office Box 231 Orlando, Florida 32802

For Respondent Michael A. Gross

Division of Assistant General Counsel Banking: Office of the Comptroller

The Capitol

Tallahassee, Florida 32304

INTRODUCTION AND RULINGS ON EVIDENTIARY MATTERS

The Sun Bank of Tampa Bay, also referred to herein as the "applicant," filed its application with the Division of Banking, Office of the Comptroller, for authority to open a branch bank in Tampa, Florida. The petitioner Carrollwood State Bank, also referred to herein as the "protestant," timely filed its petition for a public hearing on the application.

In support of its application, the applicant offered into evidence the testimony of J. Stanley Skipper, president and chief executive officer of the Sun Bank of Tampa Bay; Jack L. Trowbridge, the applicant's vice president and

coordinator of loans and the proposed branch manager of the proposed branch bank; and Shirley Ann Ryals, the applicant's assistant vice president of marketing and public relations. The public and confidential files were received into evidence as Exhibit 1. Four photographs of the proposed service area were received into evidence as Exhibit 6. The applicant's Directors Reports for November 30, 1978, December 31, 1977, and July 31, 1978, were received into evidence as Exhibits 3 through 5. Exhibit 7 consists of a newspaper article relied upon by Ms. Ryals.

The protestant Carrollwood State Bank presented the testimony of its chairman of the board of directors, Matt M. Jetton, and its vice president and cashier, Rosemary Hoyle. Keith White, president of Reinhold P. Wolff Economic Research, Inc., was qualified and accepted as an expert witness in the area of economic feasibility studies.

The Division of Banking presented no witnesses, but it was stipulated that its economic and demographic materials would be received into evidence as Composite Exhibit 2.

At the beginning of the hearing, it was ruled that the applicant would have the burden of going forward with its evidence and witnesses and proving that it met the statutory and regulatory criteria for approval of its application.

The attorney for the protestant raised and placed on the record issues concerning the constitutionality of Sections 659.06(1)(a)(1) and 120.57(1)(a)(12), Florida Statutes. It was also urged that the undersigned Hearing Officer include conclusions of law and a recommendation in her report. The undersigned is bound by the law as set forth in the Florida Statutes and has no authority to rule on the constitutionality of the two statutes in questions.

FINDINGS OF FACT

Upon consideration of the oral and documentary evidence adduced at the hearing, the following facts are found:

1. In August of 1978, the applicant filed with the Division of Banking an application for authority to open a branch bank at the southwest corner of North Dale Mabry Highway and Stall Road, an unincorporated area of Hillsborough County. This site is located approximately eleven miles north of the main office. The applicant presently has two approved branches in Hillsborough County.

   
   

2. The applicant bank was established in 1959 as the Bank of Tampa Bay. In 1972, it became the Sun Bank of Tampa Bay. Its eleven officers have no less than seven years of experience in the banking industry. The manager of the proposed branch is to be Jack L. Trowbridge, who is currently a vice president and coordinator of loans of the applicant. Mr. Trowbridge has had more than fourteen years of experience as a banking and finance official.

   
   

3. A generally accepted ideal liquidity ratio for a bank is twenty percent. The applicant's liquidity percentages have recently been as follows:

   43.76 percent as of December 31, 1977; 34.94 percent as of July 31, 1978; and

   29.94 percent as of November 30, 1978. Its loans to deposits ratios have ranged from 55.01 percent to 50.55 percent for the same periods of time. As of the date of its application, the applicant's adjusted capital to asset ratio was

   8.39 percent. It was in excess of 8.8 percent as of November 30, 1978. The

   applicant's net profit to asset ratio was 0.75 percent during calendar year 1977 and was expected to be about 0.53 percent for calendar year 1978.

   
   

4. The name of the proposed branch is to be Sun Bank of Tampa Bay - Carrollwood Office. The site consists of 200 feet fronting North Dale Mabry Highway and has a depth of 250 feet on Stall Road. The seller of this land has no connection with the applicant. The applicant proposes to construct a 3,000 square foot one story building with two drive-in lanes and space for two future lanes. It projects total deposits of $3,000,000.00 at the end of its first year of operation, $4,500,000.00 the second year and $6,000,000.00 the third year. The applicant intends to offer a full range of banking services, which are listed on pages 8 through 15 of the economic supplement in its application. These services include credit card facilities and a statewide network of 24-hour automated teller machines.

   
   

5. The proposed branch bank is to be located on the west side of North Dale Mabry Highway at Stall Road. The service area extends from this site north approximately 2.5 miles, east approximately 2.3 miles, south approximately 1.9 miles and west approximately 4.5 miles. Within a six mile radius of the proposed site are eight banks and four savings and loan offices. Two of the banks (the protestant Carrollwood State Bank and the Exchange Bank of Temple Terrace - Branch) and one savings and loan office (Freedom Federal) are located within 1.4 road miles to the south of the site. These three institutions are located on the opposite or east side of North Dale Mabry Highway. These two banks are deemed by the applicant to be its principal competitors. The proposed branch intends to emphasize lending, and thus it will also compete with the savings and loan facilities in the area for mortgage loans. Also, there are two pending applications for authority to open branch banks on the west side of North Dale Mabry within one and a half miles north of the site of the proposed branch.

   
   

6. The protestant Carrollwood is located about 1.3 miles south of the applicant on the east side of Dale Mabry. It is an independent bank and opened in 1972. Fifty percent of its stockholders reside in its trade area. The Exchange Bank of Temple Terrace is located across the street from the protestant. The Carrollwood State Bank has recently purchased property west of its present facility for the purpose of adding drive-in tellers in order to serve travellers going south. Most of the protestant's business comes from household accounts in its trade area. Its primary policy is to service these household accounts. It handles few long-term residential mortgage loans and its loan to deposit ratio is approximately 37 percent. The protestant does not presently issue credit cards. It plans to institute statewide twenty-four hour automated teller service in February, 1979. The protestant increased its total deposits last year by about 2.5 million dollars or thirty percent. For the same period of time, the averages for increases in deposits for the county was 16.6 percent, and the state average was 12.1 percent. The protestant feels there is no need for additional banking facilities in the area and that additional branch banks will slow the growth of its bank.

   
   

7. The proposed site is located in unincorporated Hillsborough County. The service area is comprised of densely populated residential areas in the southeastern portion and large tracts of undeveloped land in the northern and western portions. There are six large residential communities within the service area. Some of the residential development is still in planning stage. The only major commercial activity and development in the area is a 70,000 square foot shopping center, located approximately 1.5 miles south of the proposed branch bank. The current population of the northwest sector of the

   County, as of July, 1978, was 25,340. The Hillsborough County Planning Commission has estimated that the northern sector of the County would experience average annual growth rates of 20 percent between 1977 and 1980. However, the protestant's expert witness felt that the absorption of housing over the past few years did not support the 20 percent estimate. He also felt that there would be a 15 percent reduction in demand for new housing next year due to inflation. It was his projection that the average annual increase in population would be only 7.1 percent. The expert witness pointed out that Hillsborough County has a population per banking office of 9,131. In the northwest sector, this figure is 8,477 per bank. If the applicant's branch bank were approved, the population per bank in the northwest sector would be 6,358, and if the two remaining applications were approved, it would be 5,450 per bank. This witness did not perform a feasibility study on the subject branch application. His opinions are based upon projections of the phone company, conversations with residential salesmen and conversations with people at the Hillsborough County Planning Commission. He also drove through the service area on three occasions. The witness had no opinion as to the ability of the protestant to adequately serve the needs of the service area.

   
   

8. The applicant is in substantial compliance with all state and federal laws affecting its operation

In accordance with the provisions of Florida Statutes, Section 120.57(1)(a)(12), conclusions of law and a recommendation are not included in this Report.

Respectfully submitted and entered this 19th day of January, 1979, in Tallahassee, Florida.

DIANE D. TREMOR, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304

(904) 488-9675

COPIES FURNISHED:

1. Riley Davis

   Taylor, Brion, Buker and Green Post Office Box 1796 Tallahassee, Florida 32302

   
   

   Nicholas Yonclas

   Akerman, Senterfitt and Eidson Post Office Box 231

   Orlando, Florida 32802

   
   

   Michael A. Gross Assistant General Counsel Office of the Comptroller The Capitol

   Tallahassee, Florida 32304

   Comptroller Gerald Lewis The Capitol

   Tallahassee, Florida

   
   

   ================================================================= AGENCY FINAL ORDER

   =================================================================

   
   

   STATE OF FLORIDA DEPARTMENT OF BANKING AND FINANCE

   DIVISION OF BANKING

   
   

   CARROLLWOOD STATE BANK,

   
   

   Petitioner,

   
   

   vs. CASE NO. 78-1692

   
   

   SUN BANK OF TAMPA BAY AND DIVISION OF BANKING,

   
   

   Respondent.

   /

   
   

   FINAL ORDER

   
   

   Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, on December 20, 1979, in the Tampa Chamber of Commerce Board Room, Tampa, Florida. The purpose of the hearing was to receive evidence concerning the application of the Sun Bank of Tampa Bay to open a branch banking facility at the southwest corner of Stall Road and Dale Mabry Highway in Tampa, Florida.

   
   

   APPEARANCES

   
   

   For Petitioner: J. Riley Davis

   Carrollwood Taylor, Brion, Buker and Green State Bank: Post Office Box 1796

   Tallahassee, Florida 32302

   
   

   For Respondent Nicholas Yonclas

   Sun Bank: Akerman, Senterfitt and Eidson

   Post Office Box 231 Orlando, Florida 32802

   
   

   For Respondent Michael a. Gross

   Division of Assistant General Counsel Banking: Office of the Comptroller

   The Capitol

   Tallahassee, Florida 32304

   Upon consideration of the oral and documentary evidence adduced at the hearing, the Report of the Hearing Officer submitted on January 19, 1979, is hereby adopted and incorporated herein, except that the first sentence of paragraph number three is rejected as possibly misleading as to the statutory reserve requirements set forth in Section 659.16, Florida Statutes. The Report includes an Introduction and Rulings on Evidentiary Matters, and Findings of Fact as paragraphs 1-8.

   
   

   The pertinent provision of Chapter 659, Florida Statutes, which governs the approval of branch banks is as follows:

   
   

   659.06(1)(a)1. Any bank. . .incorporated pursuant to this chapter shall have one principal place of doing business as designated in its articles of incorporation; in addition, with the approval of the Department and upon such conditions as the Department shall prescribe, including a satisfactory showing by the bank that public convenience and necessity will be served thereby, any bank may establish up to two (2) branches per calendar year within the limits of the county. . ."

   
   

   The Department has fully complied with Chapter 120, Florida Statutes, in enacting Rule 3C-13.041(2), Florida Administrative Code, which provides in its entirety as follows:

   
   

   3C-13.041 - Regulatory Standards for Evaluating Applications

   1. Standards. In making its determination the department shall consider the following criteria, to wit:

      1. The applicant has or agrees to provide sufficient capital accounts to support the bank's deposit base and the additional fixed asset proposal for such branch and its operations, without undue exposure to its depositors or shareholders. Generally, an adjusted capital (All capital accounts plus reserves minus all assets classified loss and

         50.0 percent of total assets classified doubtful) to asset ratio of 7.0 percent shall be considered adequate to support the expansion for a branch. It should be noted, however, that other factors, including

         earnings, managerial capacity, asset condition, past performance, and degree of liquidity, among others, are important in assessing the overall capacity of a bank to establish a branch and may, therefore, have an impact on the adequacy of the capital to asset ratio.

      2. The applicant has sufficient earnings and earning prospects to support the anticipated expenses of such branch, without jeopardizing the profitable position of the bank, its retained earnings, or the dividend return to

         its shareholders. A net profit to asset ratio of 0.5 percent or above during the last calendar year is generally considered adequate to support the expansion for a branch. It should be noted, however, that factors such as liquidity asset condition, managerial capacity, past performance, among others, are important in assessing the overall capacity of a bank to establish a branch and may, therefore, have an impact on the relative significance of a net

         profit to asset ratio above or below 0.5 percent.

      3. The applicant has sufficient depth and quality of management to operate the branch without reducing its current level of service or exceeding its managerial or operational capacity.

      4. The name of the proposed branch reasonably identifies the branch as such and is not

         likely to unduly confuse the public.

      5. The applicant is in substantial compliance with all state and federal laws affecting its operations.

INTRODUCTION AND RULINGS ON EVIDENTIARY MATTERS

The Sun Bank of Tampa Bay (hereinafter "Applicant"), filed its application with the Department of Banking and Finance, Division of Banking (hereinafter "Department"), for authority to open a branch bank in Tampa, Florida. The petitioner, Carrollwood State Bank (hereinafter "Protestant"), timely filed its petition for a public hearing on the application.

In support of its application, the Applicant offered into evidence the testimony of J. Stanley Skipper, president and chief executive officer of the Sun Bank of Tampa Bay; Jack L. Trowbridge, the Applicant's vice president and coordinator of loans and the proposed branch manager of the proposed branch bank; and Shirley Ann Ryals, the Applicant's assistant vice president of marketing and public relations. The public and confidential files were received into evidence as Exhibit 1. Four photographs of the proposed service area were received into evidence as Exhibit 6. The Applicant's Directors Reports for November 30, 1978, December 31, 1977, and July 31, 1978, were received into evidence as Exhibits 3 through 5. Exhibit 7 consists of a newspaper article relied upon by Ms. Ryals.

The Protestant, Carrollwood State Bank, presented the testimony of its chairman of the board of directors, Matt M. Jetton, and its vice president and cashier, Rosemary Hoyle. Keith White, president of Reinhold P. Wolff Economic Research, Inc., was qualified and accepted as an expert witness in the area of economic feasibility at studies.

The Department presented no witnesses, but it was stipulated that its economic and demographic materials would be received into evidence as Composite Exhibit 2.

At the beginning of the hearing, it was ruled that the Applicant would have the burden of going forward with its evidence and witnesses and proving that it met the statutory and regulatory criteria for approval of its application.

The attorney for the Protestant raised end placed on the record issues concerning the constitutionality of Sections 659.06(1)(a)(1) and 120.57(1)(a) 12., Florida Statutes. It was also urged that the Hearing Officer include conclusions of law and a recommendation in her report. The Hearing Officer and the Department are bound by the law as set forth in the Florida statutes and have no authority to rule on the constitutionality of the two statutes in question.

FINDINGS OF FACT

Upon consideration of the oral and documentary evidence adduced at the hearing, the following facts are found:

1. In August of 1978, the Applicant filed with the Department an application for authority to open a branch bank at the southwest corner of North Dale Mabry Highway and Stall Road, an unincorporated area of Hillsborough County. This site is located approximately eleven miles north of the main office. The Applicant presently has two approved branches in Hillsborough County.

   
   

2. The Applicant bank was established in 1959 as the Bank of Tampa Bay.

   In 1972, it became the Sun Bank of Tampa Bay. Its eleven officers have no less then seven years each of experience in the banking industry. The manager of the proposed branch is to be Jack L. Trowbridge, who is currently a vice president and coordinator of loans of the Applicant. Mr. Trowbridge has had more than fourteen years of experience as a banking and finance official.

   
   

3. The Applicant's liquidity percentages have recently been as follows:

   43.76 percent as of December 31, 1977; 34.94 percent as of July 31, 1978; and

   29.94 percent as of November 30, 1978. Its loans to deposits ratios have ranged from 55.01 percent to 50.55 percent for the same periods of time. As of the date of its application, the Applicant's adjusted capital to asset ratio was

   8.39 percent. It was in excess of 8.8 percent as of November 30, 1978. The Applicant's net profit to asset ratio was 0.75 percent for calendar year 1977 end was expected to be about 0.53 percent for calendar year 1978.

   
   

4. The name of the proposed branch is to be Sun Bank of Tampa Bay - Carrollwood Office. The site consists of 200 feet fronting North Dale Mabry Highway and has a depth of 250 feet on Stall Road. The seller of this land has no connection with the Applicant. The Applicant proposes to construct a 3,000 square foot one story building with two drive-in lanes and space for two future lanes. It projects total deposits of $3,000,000.00 at the end of its first year of operation, $4,500,000.00 the second year and $6,000,000.00 the third year. The Applicant intends to offer a full range of banking services, which are listed on pages 8 through 15 of the economic supplement in its application, including credit card services end a statewide network of 24-hour automated teller machines.

   
   

5. The proposed branch bank is to be located on the west side of North Dale Mabry Highway at Stall Road. The service area extends from this site north approximately 2.5 miles, east approximately 2.3 miles, south approximately 1.9 miles end west approximately 4.5 miles. Within a six mile radius of the proposed site are eight banks and four savings and loan offices. Two of the banks (the Protestant, Carrollwood State Bank, and the Exchange Bank of Temple Terrace - Branch) and one savings and loan office (Freedom Federal) are located within 1.4 road miles to the south of the site. These three institutions are

   located on the opposite or east side of North Dale Mabry Highway. These two banks are deemed by the Applicant to be its principal competitors. The proposed branch intends to emphasize lending, and thus it will also compete with the savings and loan facilities in the area for mortgage loans. Also, there are two pending applications for authority to open branch banks on the west side of North Dale Mabry within one and a half miles north of the site of the proposed branch.

   
   

6. The Protestant, Carrollwood, is located about 1.3 miles south of the Applicant on the east side of Dale Mabry. It is an independent bank and opened in 1972. Fifty percent of its stockholders reside in its trade area. The Exchange bank of Temple Terrace is located across the street from the Protestant. The Carrollwood State Bank has recently purchased property west of its present facility for the purpose of adding drive-in tellers in order to serve travellers going south. Most of the Protestant's business comes from household accounts in its trade area. Its primary policy is to service these household accounts. It handles few long-term residential mortgage loans and its loan to deposit ratio is approximately 37 percent. The Protestant does not presently issue credit cards. It plans to institute statewide twenty-four hour automated teller service in February 1979. The Protestant increased its total deposits last year by about 2.5 million dollars or 30.0 percent. For the same period of time, the averages for increases in deposits for the County was 16.6 percent and the state average was 12.1 percent. The Protestant feels there is no need for additional banking facilities in the area and that additional branch banks will slow the growth of its bank.

   
   

7. The proposed site is located in unincorporated Hillsborough County. The service area is comprised of densely populated residential areas in the southeastern portion end large tracts of undeveloped land in the northern and western portions. There are six large residential communities within the service area. Some of the residential development is still in the planning stage. The only major commercial activity and development in the area is a

   70,000 square foot shopping center, located approximately 1.5 miles south of the proposed branch bank. The current population of the northwest sector of the county, as of July 1978, was 25,340. The Hillsborough County Planning Commission has estimated that the northern sector of the county would experience average annual growth rates of 20.0 percent between 1977 and 1980. However, the Protestant's expert witness felt that the absorption of housing over the past few years did not support the 20.0 percent estimate. He also felt that there would be a 15.0 percent reduction in demand for new housing next year due to inflation. It was his projection that the average annual increase in population would be only 7.1 percent. The expert witness pointed out that Hillsborough County has a population per banking office of 9,131. In the northwest sector, this figure is 8,477 per bank. If the Applicant's branch bank were approved, the population per banking office in the northwest sector would be 6,358, and if the two remaining applications were approved, it would be 5,450 per office.

   This witness did not perform a feasibility study on the subject branch application. His opinions are based upon projections of the phone company, conversations with residential salesmen and conversations with people at the Hillsborough County Planning Commission. He also drove through the service area on three occasions. The witness had no opinion as to the ability of the Protestant to adequately serve the needs of the service area.

   
   

8. The Applicant is in substantial compliance with all state and federal laws affecting its operation.

The Deputy Comptroller, Gerri Paines Dolan, and the Director of the Division of Banking, Ryland Terry Rigsby, as advisory staff members to the Comptroller, reviewed the Hearing Officer's Report and the entire record. They assisted end concurred with the Comptroller in the ultimate determination of this application.

RULINGS ON EXCEPTIONS TO REPORT

Pursuant to Rule 3C-9.11, Florida Administrative Code, the Applicant and Protestant filed exceptions to the Hearing Officer's Report on January 30, 1979, and February 1, 1979, respectively. The Department did not file any exceptions to the Hearing Officer's Report. The Department rules on the Applicant's exceptions as follows:

1. The Applicant has no exceptions to paragraph one, three, four, six and eight of the Hearing Officer's Report and therefore, no ruling is necessary.

   
   

2. Exception number two is well taken and the requested correction has been made.

   
   

3. Exception number five is immaterial to the disposition of this application.

   
   

4. Exception number seven relates to a credibility determination made by the Hearing Officer, and the Department has deferred to the Hearing Officer's findings in this regard.

   
   

5. Exceptions a. through i. are addressed hereinafter in the Department's Rulings on Proposed Findings of Fact.

The Department rules on the Protestant's exceptions as follows:

1. The Protestant's position in its exception number one is essentially that Sections 120.57(1)(b)8. and 12., Florida Statutes, exempt the Hearing Officer from the mandatory requirement of submitting a recommended order, but allow the Hearing Officer the discretion to submit a recommended order.

   
   

   The Protestant has misconstrued the legislative intent. The legislature in enacting the aforementioned exemption has placed the conclusions of law exclusively within the Comptroller's responsibility in recognition of the unique circumstances and complexity inherent in the evaluation of license applications for state-regulated financial institutions. Accordingly, the legislature has deferred to the hearing officer's expertise regarding findings of fact and rulings on evidentiary matters while at the same time deferring to the Comptroller's expertise regarding conclusions of law. Therefore, Section 120.57(1)(b)12., Florida Statutes, in delineating what the hearing officer must do, also sets forth the parameters as to what the hearing officer can do.

   
   

2. Exceptions 2a through 2d are addressed hereinafter in the Department's Rulings on Proposed Findings of Fact.

RULINGS ON PROPOSED FINDINGS OF FACT

The Applicant, Protestant, and Department submitted Proposed Findings of Fact pursuant to Rule 3C-9.11, Florida Administrative Code.

The Applicant's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings stated in the Hearing Officer's Report or where they may constitute conclusions of law, with the following exceptions:

1. The last sentence of Proposed Finding Number 8 is rejected to the extent that it constitutes a legal argument as opposed to a finding of ultimate fact.

   
   

2. Proposed Finding Number 11 is rejected in that it constitutes legal argument as opposed to a finding of ultimate fact.

   
   

3. Proposed Finding Number 15 is rejected in that it constitutes a conclusion of law.

The Protestant's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings stated in the Hearing Officer's Report or where they may constitute conclusions of law, with the following exceptions:

1. The first sentence of Proposed Finding Number 6 is rejected in that it is speculative, constitutes legal argument, and is not supported by competent substantial evidence. The last sentence of Proposed Finding Number 6 is rejected in that it constitutes a conclusion of law as to the reason why the Protestant's bank charter was granted.

   
   

2. The first, third, fourth and fifth sentences of Proposed Finding Number

   10 are rejected, as they constitute legal arguments based upon restatement of testimony, as opposed to findings of ultimate fact.

   
   

3. The second sentence of Proposed Finding Number 11 is rejected in that it constitutes a conclusion of law.

   
   

4. Proposed Finding Number 14 is rejected in that it consists of argumentative references to testimony and not findings of ultimate fact.

   
   

5. Proposed Finding Number 24 is rejected in that it constitutes legal argument and conclusions of law rather than findings of ultimate fact.

   
   

6. The first sentence of Proposed Finding Number 26 is rejected in that it constitutes a conclusion of law. The second sentence of Proposed Finding Number

   26 is rejected in that it is repetitious and constitutes a conclusion of law. The Fourth sentence of Proposed Finding Number 26 is rejected in that it constitutes a conclusion of law.

   
   

7. Proposed Finding Number 27 is rejected in that it constitutes a conclusion of law.

   
   

8. Proposed Finding Number 28 is rejected in that it constitutes legal argument rather than a finding of ultimate fact.

   
   

9. The last sentence of Proposed Finding Number 31 is rejected in that it constitutes legal argument and a conclusion of law.

The Department's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings of the Hearing Officer's Report or where they may constitute conclusions of law.

CONCLUSIONS OF LAW

1. When an application to open a branch bank is filed, it is the applicant's responsibility to prove that the minimum requirements set forth in Section 659.06, Florida Statutes, and Rule 3C-13.041, Florida Administrative Code, which are prerequisites to the granting of authority, are met. It is the duty of the Department to make an investigation of the factors listed therein and then to approve or disapprove the application in its discretion. This discretion is neither absolute nor unqualified, but is conditioned upon a consideration of the criteria listed in Section 659.06, Florida Statutes and Rule 3C-13.041, Florida Administrative Code.

   
   

2. If in the opinion of the Department, any of the foregoing criteria have not been met, and cannot be remedied by the applicant, it cannot approve the application. If the criteria have been met, it still remains within the discretion of the Department to approve or disapprove the application. In considering a branch application, the applicant's capacity to support such expansion is of major importance. The closing of a branch does not present the same risk of loss to the public as does the failure of a bank. Therefore, the judgment of the applicant as to the viability of a proposed branch will ordinarily be respected, provided that in the opinion of the Department, the applicant's capacity is sufficient or will be enhanced by the new activity.

   This policy has been formalized in Rule 3C-13.041, Florida Administrative Code.

   
   

3. The Department concludes that the Applicant has realistically delineated its primary service area in accordance with Rule 3C-13.041(1), Florida Administrative Code.

   
   

4. It is the opinion and conclusion of the Department that the Applicant has sufficient capital accounts to support the bank's deposit base and the additional fixed asset proposal for the proposed branch and its operations, without undue exposure to its depositors or shareholders. Therefore, the criterion of Rule 3C-13.041(2)(a), Florida Administrative Code, IS met.

   
   

   The Applicant's adjusted capital to asset ratio was 8.39 percent as of the data of its application and was in excess of 8.8 percent of of November 30, 1978. These ratios exceed the minimum requirements of the aforementioned rule. Furthermore, the adequacy of the Applicant's capital to asset ratio is reinforced by a favorable assessment of the other factors enumerated in the aforementioned rule, which factors are fully discussed hereinafter in Sections 5 and 6. Hence, establishment of the proposed branch will not unduly expose the Applicant's depositors or shareholders.

   
   

5. It is the opinion and conclusion of the Department that the Applicant has sufficient earnings and earning prospects to support the anticipated expenses of the proposed branch, without jeopardizing the profitable position of the bank, its retained earnings, or the dividend return to its shareholders. Therefore, the criterion of Rule 3C-13.041(2)(b), Florida Administrative Code, IS met.

   
   

   The Applicant's net profit to asset ratio was 0.75 percent during calendar year 1977 and was expected to be approximately 0.53 percent for calendar year 1978. This ratio exceeds the minimum requirements of the aforementioned Rule. Furthermore, the Applicant exceeded the reserve requirements of Section 659.16, Florida Statutes, in calendar years 1977 and 1978.

   The Applicant's designated primary service area (hereinafter PSA) is located in an unincorporated area of Hillsborough County. The University of Florida population studies indicate that most of the population growth in the county between 1970 and 1977 has been in the unincorporated areas, and the Protestant's expert witness projected an average annual increase in population of 7.1 percent in the PSA between 1977 and 1980. Most, 76.63 percent, of the population growth in the county between 1970 and 1977 resulted from net migration. This is generally considered a favorable factor for a new banking office in that newcomers have no ties to the more established banking offices.

   
   

   There are presently three financial institutions in the PSA, the Protestant, one branch bank, and one savings and loan association, all located on the east side of North Dale Mabry Highway. The Applicant proposes to locate on the west side of North Dale Mabry Highway, approximately 1.4 road miles north of the Protestant's main office. The Applicant's location will enable it to more conveniently serve potential customers traveling south on North Dale Mabry Highway. The Protestant has recently purchased property west of its present facility for the purpose of adding drive-in tellers, so that it may serve travelers going south on North Dale Mabry Highway.

   
   

   Indicative of the significant growth of financial institutions in the area, Protestant increased its deposits by 30.2 percent for the period between June 30, 1977 and June 30, 1978, well above the county average of 16.6 percent and the state average of 12.1 percent during the same period.

   
   

   The Protestant primarily serves household accounts, handles few long-term residential mortgage loans, and its loan to deposit ratio was a relatively low

   36.9 percent as of June 30, 1978. On the other hand the Applicant intends to emphasize lending and to compete with the savings and loan facilities in the area for long term mortgage loans.

   
   

   Furthermore, the Applicant intends its branch to provide a broad spectrum of banking services including a statewide network of twenty-four hour automated teller machines, the all-in-one account, a merchant check acceptance program, and Master Charge and Visa credit card accounts directly with the Applicant.

   The Protestant plans to institute statewide twenty-four hour automated teller service in February 1979. Although arguably each of the services proposed by the Applicant is available at one or the other of the financial institutions in the PSA and the larger trade area, there is no evidence in the record of any financial institution which provides the broad spectrum of services proposed by the Applicant at one location for one-stop banking, especially in close proximity to the 70,000 square foot Carrollwood Center Shopping Center which contains a Publix supermarket, Eckerd Drugs and 15 small stores.

   
   

6. It is the opinion and conclusion of the Department that the Applicant has sufficient depth and quality of management to operate the branch without reducing its current level of services or exceeding its managerial or operational capacity. Therefore, the criterion of Rule 3C-13.041(2)(c), Florida Administrative Code, IS met.

   
   

   The Applicant has demonstrated, both by its past performance as well as the credentials of its management team, that it has sufficient managerial capacity to successfully operate the proposed branch.

   
   

7. It is the opinion and conclusion of the Department that the name of the proposed branch reasonably identifies the branch as such, and is not likely to

   unduly confuse the public. Therefore, the criterion of Rule 30-15.041(2)(d), Florida Administrative Code, IS met.

   
   

8. It is the opinion and conclusion of the Department that the Applicant is in substantial compliance with all state and federal laws affecting its operations. Therefore, the criterion of Rule 3C-13.041(2)(e), Florida Administrative Code, IS met.

   
   

9. Upon consideration that the Applicant has met the criteria set forth in Rule 3C-13.041 (2)(a), (b), (c), (d), and (e), the Department is satisfied that public convenience and necessity will be served by the proposed branch.

   
   

10. It is the opinion and conclusion of the Department that the Application involves no insider transactions within the meaning of Rule 3C- 13.041(3), Florida Administrative Code.

FINAL ORDER

Based upon the foregoing findings of fact and conclusions of law, it is thereupon:

ORDERED AND ADJUDGED that the application of Sun Bank of Tampa Bay, Tampa, Florida, for authority to open a branch at 12650 Dale Mabry Extension, Tampa, Hillsborough County, Florida, is hereby granted upon the following conditions:

1. That the branch bear the name Sun Bank of Tampa Bay - Carrollwood Office;

   
   

2. That the Federal Deposit Insurance Corporation give final approval of the branch at the designated site.

Until the Conditions herein specified, and other reasonable requirements of the Department are met, or if any interim development is deemed by the Comptroller to warrant such action, the Comptroller shall have the right to alter, suspend, or withdraw this approval.

Should the branch not be opened within twelve (12) months after departmental approval of the Application, such approval shall automatically expire, unless extended by the Department in the meantime for good cause shown.

Subsequent to the approval by the Department and the Federal Deposit Insurance Corporation and at least twenty one (21) days prior to the desired opening date, the Department shall be given notice of the opening date. Upon receipt of such notice, the Department shall issue a Certificate of Authority to open and operate the branch.

DONE AND ORDERED THIS 19th day of February, 1975, in Tallahassee, Florida.

GERALD A. LEWIS

Comptroller of Florida The Capitol

Tallahassee, Florida 32304

(904) 488-0370

CERTIFICATE OF FILING AND SERVICE

I HEREBY CERTIFY that the original of the foregoing has been filed with the Department of Banking and Finance and that a true and correct copy of the foregoing has been sent by Certified U.S. Mail, Return Receipt Requested, to J. Riley Davis, Taylor, Brion, Buker and Green, Post Office Box 1796, Tallahassee, Florida 32302, and Nicholas Yonclas, Akerman, Santerfitt and Eidson, Post Office Box 231, Orlando, Florida 32802 this 20th day of February, 1979.

MICHAEL A. GROSS

Assistant General Counsel Office of the Comptroller The Capitol

Tallahassee, Florida 32304

(904) 488-9896

Docket for Case No: 78-001692

Orders for Case No: 78-001692