Patriot State turns corner on profitability

Patriot State Bank has made its first quarterly profit ever.

But not its last, said David Bell, executive vice president of the Fuquay-Varina-based bank.

"We feel that we are positioned well to be able to maintain profitability," Bell said.

Patriot State was formed in 2006 after raising more than $19 million in capital from investors. The bank actually took longer to reach profitability than its original projections because of the difficult environment banks have faced in the past few years, Bell said.

The bank reported a profit of $80,966 in the first quarter, versus a loss of $302,000 a year ago.

The bank had $135 million in assets at the end of March, up from $111 million a year ago. Loans totaled $113.8 million, versus $89.5 million a year ago.

"We needed to have loan growth in order to achieve profitability," Bell said. "We actually grew our loans when a lot of banks were pulling bank."

The bank also increased its allowance for loan losses to $2.8 million, up from $1.3 million a year ago. Bell said the bank took a conservative approach "with as high a reserve as we could justify" given the state of the economy.

Patriot State has branches in Fuquay-Varina, Clayton and Clinton, and a loan production office in Cary. The Clinton branch is currently in temporary space in an office building, but the bank plans to open a new stand-alone facility, complete with a drive-through, on June 1st.