Letter From Our President


Dear Shareholder:

On behalf of the Board of Directors and the management team of FineMark National Bank & Trust, I am pleased to report continued positive trends with regard to the bank’s performance during the calendar quarter ending March 31, 2009. The bank’s income statement, balance sheet and overall asset quality remains strong in this extremely challenging economic environment.

First Quarter Financial Highlights

Revenues for the first quarter of 2009 totaled $1.09 million which represents a 38% increase over the first quarter of last year. FineMark’s increasing revenues coupled with lower than budgeted expenses resulted in a net loss of $483 thousand compared to a budgeted loss of $517 thousand for the period ending March 31, 2009. Please note that loan growth exceeded plan which resulted in a higher than budgeted loan loss reserve expense. The bank allocated $197 thousand to the reserve compared to a plan amount of $102 thousand. On a cash basis (adding non-cash charges to the net loss), the net loss was $44 thousand.

Deposits ended the quarter at $104.8 million, up by $16.3 million from year-end 2008. FineMark benefited from strong growth by establishing new client relationships.

FineMark’s loan portfolio closed the quarter at $95.2 million of loans outstanding which grew by $15.6 million since the end of last year. The bank decided to increase its loan loss reserve for the existing loan portfolio in an effort to maintain a conservative posture in light of these difficult economic conditions. The loan loss reserve is currently maintained at 1.5% of total loans.

FineMark’s total assets grew to $154.4 million as of March 31, 2009. The bank has invested a portion of its liquidity into high quality bonds which totaled $42.2 million as of March 31st. FineMark is very well capitalized with a Tier I Capital Ratio of approximately three times the required regulatory level.

As of May 15, 2009, deposits, loans and bank assets totaled $120.6 million, $97.4 million, and $176.1 million, respectively.

Trust and investment assets grew from $145.7 million to $167.2 million during the quarter. The trust and investment pipeline remains very strong as evidenced by current asset levels in excess of $225 million.

Business Highlights

Our new Coconut Point office opened as scheduled on February 2, 2009. We held two very successful open house events during which more than 500 guests were in attendance. Please feel free to visit Dennis Landfried and his team when you are in the area.

FineMark was selected to serve as the exclusive provider of banking services to Shell Point Retirement Community residents during a search for an on-site bank conducted in February 2009. We have received OCC approval and plan to open this third office in June.

Our Annual Shareholder’s meeting was held on March 27, 2009.

FineMark’s website has been redesigned to a more sophisticated look with enhanced features. We will use the website as another opportunity to communicate with our clients and shareholders. Please visit the site at www.finemarkbank.com.

On behalf of my colleagues at FineMark, I thank you for your continued support and confidence.

Kind Regards,

Joseph R. Catti
President and Chief Executive Officer