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Southport Bank hires Michael Falbo as CEO

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BY JOE POTENTE

jpotente@kenoshanews.com

A banking industry veteran with Kenosha ties has been tapped to lead Southport Bank.

Michael Falbo, a member of the University of Wisconsin System Board of Regents who grew up in Kenosha, took the reins as president and chief executive officer of the Kenosha-based bank Tuesday.

Falbo, a University of Wisconsin-Parkside graduate, was in the banking scene in the Milwaukee area for many years, building the former State Bank of Hales Corners into a more than 30-branch operation that was merged into Associated Banc-Corp in 2005.

Most recently, Falbo worked a brief stint as the chairman and CEO trying to revive TierOne, a struggling Lincoln, Neb.-based bank that regulators closed last month.

“They were just too far gone,” Falbo said in an interview in his new office Tuesday.

‘Bright future’

Falbo said he sees a bright future for Southport Bank, which has had its own challenges with regulators.

The bank signed an agreement with the Federal Deposit Insurance Corp. last year, pledging to improve its financial condition.

A more recent $29.45 million capital raise, highlighted by a pending takeover by Ohio businessman Gaetano Cecchini, has been successful, Southport Executive Vice President and Chief Operating Officer Arthur Thompson said Tuesday.

Cecchini’s $8.5 million investment in the bank has received regulators’ approval, though Thompson said the act of infusing the new capital into the bank is continuing.

Falbo, 61, becomes the bank’s third president and CEO in as many years.

He succeeds Gerald Schwallier, who took over in June 2009 after the retirement of the bank’s founding president, Karl Ostby. Schwallier stepped aside last month to care for his wife.

Falbo said he had talks with Southport directors over the last year about what the bank could do to improve its situation.

“I want to see this work,” Falbo said. “Community banking is needed. It’s a special type of banking.”

Plans to improve assets

Falbo said he believes Schwallier and the bank’s board made positive steps over the last year, after a routine regulatory examination found Southport to be in a weak financial position.

With the capital raise largely completed, Falbo said he will work to improve the quality of the bank’s assets and the strength of its capital. He agreed with past assessments that risky, out-of-town lending caused many of the bank’s problems.

“We’ll do it one customer at a time, one deal at a time, and try to move forward,” Falbo said.

Thompson said he was well aware of Falbo’s banking background and is “ecstatic” to have him at Southport.

“I’m very pleased to finally be able to work with Mike,” Thompson said.

Founded in 1997, Southport has assets of about $400 million and five area locations, including three in Kenosha, one in Paddock Lake and one in Racine. The main office is at 7027 Green Bay Road.