Less than a year after he was brought in to "reinvent" Sun Bancorp Inc.'s retail bank, Jeffrey P. Hawkins has resigned.
The $3.3 billion-asset Vineland, N.J., company said this week that Mr. Hawkins, who joined in September from JPMorgan Chase & Co., has left to take a position with a California specialty finance lender.
Sun has named Edward Malandro, who had been its director of sales and marketing, to succeed Mr. Hawkins as the head of retail banking.
The announcement surprised analysts, considering that Mr. Hawkins arrived at Sun with some fanfare, after a nationwide search to fill a position that had been vacant for a year. Sun's chief executive officer at the time said that executives had been "talking about reinventing the retail bank for about a year," and that they had finally found the "right leader" in Mr. Hawkins.
But Joseph Fenech, an analyst at Sandler O'Neill & Partners LP, wrote in a research note issued Tuesday that his departure should not be disruptive. "Management indicated to us that Mr. Malandro has essentially served as Mr. Hawkins right-hand man."
Mr. Malandro, a senior vice president, joined Sun in 2001 from First Union Corp. He said in an interview this week that in his most recent role, he worked closely with Mr. Hawkins to implement Sun's retail strategy.
"Jeff created a sales culture within the bank, and it's that sales culture that we really want to continue," Mr. Malandro said.
As the head of retail banking, Mr. Malandro will continue to run the marketing department while overseeing the facilities department and Sun's 70 branches.
Sun is evaluating how to prune the branch network, and Sidney R. Brown, its acting president and CEO, has said that some branches might need better locations.
About 15 to 20 are considered underperforming, with less than $20 million of deposits, well below the average for New Jersey banks.
In the second half of last year Sun sold three branches and consolidated two others. Mr. Brown said on a conference call last week that it plans to consolidate two or three branches this quarter and is moving two others.
Sun contracted last month with an outside firm to evaluate its branch locations from the perspective of demographics and other factors, he said, and the final report is due in several weeks. Further decisions about the branch network will be made after the study's completion, he said.
Mr. Brown said that Sun has not achieved the results it wanted with previous closings, and that it intends to weigh considerations such as the potential loss of low-cost deposits.
"We're trying to spend a little bit more time making sure that we look at this thing from a different approach than what historically was done, to make sure that we're going to get the most bang for our buck," he said.
Sun has also been searching for a new CEO since the board ousted Thomas A. Bracken in January after losing patience with the company's lackluster performance.
Earnings have improved in the last two quarters - second-quarter net income rose 30% from a year earlier, to $4.9 million. But analysts remain concerned about Sun's high overhead and the impact of the yield curve on its ability to achieve meaningful revenue growth.
Investors also appear skeptical. Sun's shares have fallen 29% for the year, including nearly 12% since July 16, when the company released its second-quarter earnings report.
