After getting federal bailout funds two years ago and a half-billion-dollar Texas rescue last year, the parent company of Santa Barbara Bank & Trust this week reported a net income of $20.5 million for the third quarter of this year.

Pacific Capital Bancorp officials said the third-quarter report means that since last year’s $500 million investment from a subsidiary of Texas-based Ford Financial Fund, total net income has reached $84 million.

That’s a far cry from just two years ago when company was reeling in the midst of the recession.

Bank officials also said the company boosted regulatory capital ratios to 12.1 percent and 20 percent tier leverage and total risk-based capital ratios, respectively. The capital ratios are important because federal regulators closed many banks in the past few years that had low ratios.

“We’re pleased with what has been achieved in the first year since our recapitalization of this great community bank,” said Carl B. Webb, who was brought in last year to replace George Leis as chief executive officer of Pacific Capital. “We’ve achieved strong earnings performance, effectively managed credit issues from the company’s legacy loan portfolio, reintroduced lending products within our footprint, and continue to grow our core deposit base.”

A legacy loan is a poorly performing mortgage or other troubled asset owned by a bank. Another name for legacy loans is “toxic assets,” which plague many bank holding companies like Pacific Capital.

The U.S. Treasury Department allowed Pacific Capital to pay back only 63 percent of the more than $181 million given to the embattled company through the Troubled Asset Relief Program about two years ago when bad real estate loans almost brought down the Central Coast’s largest bank holding company. That means taxpayers had a lot to do with keeping Pacific Capital afloat.

In the dark days of 2008 when the company reported multimillion-dollar losses, Pacific Capital shed more than 325 of its 1,664 full-time employees and cut retiree benefits as loan losses mounted. However, the company has hired back about two-thirds of those workers.

The South Coast Biz Blog is a roundup of the latest business news in the Santa Barbara area and is written by Ray Estrada, who has covered business in the region for numerous publications over the past couple decades. See more at and


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