Saying No to TARP: Charles Antonucci Sr., CEO, Park Avenue Bank

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"I don't need TARP money." That's the message to depositors from Charles Antonucci Sr., CEO of Park Avenue Bank, which recently withdrew its application for federal Troubled Asset Relief Plan (TARP) funds.

In an exclusive interview, Antonucci discusses:

Charles Antonucci, Sr. is The Park Avenue Bank's President and Chief Executive Officer, who brings more than 30 years of banking experience to his position. He is responsible for significantly expanding the bank's asset base and branch network throughout the New York marketplace.

TOM FIELD: Hi this is Tom Field, Editorial Director with Information Security Media Group. We're talking about an interesting banking case today, about a bank that has withdrawn its application for TARP funds. We are talking with Charles Antonucci, CEO of Park Avenue Bank. Charles, thank you so much for joining me.

CHARLES ANTONUCCI: You're quite welcome. It's my pleasure.

FIELD: Just for a little background, why don't you tell us a little bit about your institution and yourself?

ANTONUCCI: Okay. Park Avenue Bank has been in existence since the late 80's, 1987. It was acquired by a group which I was a part of in June of 2004, and in June 2004 it was about an $85 million dollar bank -- very different model than it is now, but we basically turned it into a small business bank in Manhattan, and with retail branches we are now a little over $500 million with four branches in Manhattan.

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For myself, I have been in and out of banking for 35 years in various positions, a couple of CEO spots and in an ownership position in some of the cases as I am here in this institution.

Where we are right now, I guess the bank is very active in the New York City market and seeing more business opportunities than we have seen since we acquired the bank in June of 2004.

FIELD: Well, that's good news. Now you made the news recently, Charles, because you withdrew your application for TARP funds. Why is that?

ANTONUCCI: Yes. Well, a couple of reasons. Primarily there are a lot of issues with the TARP funding and the perception. It was two things: Nobody really knows what the rules are going to be in terms of those who take and utilize the TARP money, and that is very unsettling in any business and even more so in the banking business because we are already highly regulated. And secondly, there is market perception that if you take TARP money, that you are now a bad bank, which is a perception that nobody wants whether you are or you aren't. Nobody needs that perception in a marketplace where everybody is concerned about safety.

FIELD: Sure. So why did you apply in the first place, and what changed between the time you applied and when you made your decision to withdraw?

ANTONUCCI: Well, we applied when the program initially came out. Again, at that time the perception was if you didn't apply and get TARP money, you were too weak to get it; in other words, in order to get the money you had to be a strong bank. So the perception in the marketplace is if you didn't apply for it then, if you didn't get TARP money initially when you applied for it then you were a troubled bank. It was just kind of reverse to where it is now.

And the rules then were much simpler. It was a program that was evolving, and everybody was encouraged to apply for TARP money by the regulatory agencies. Some were basically told to take it, and so there was a very different perception in the market. When we applied and the program evolved over time, we recognized that it wasn't the best thing to be involved with, and I think we had pretty much come to that conclusion in November/December and we finally withdrew the application, I believe in February.

FIELD: The phrase comes to mind, "damned if you do and damned if you don't."

ANTONUCCI: Correct. Correct. You know, I think that it was very hastily put together, and nobody really knew the rules, so the fact that we were a little slow pulling the trigger and applying actually helped us more than hurt us.

FIELD: So by withdrawing the application, what would you say the message is to your bank's depositors?