David Druey, Florida Regional President, Centennial Bank

In an interview with Invest: David Druey, Florida regional president of Centennial Bank, discussed the bank’s record-breaking year, challenges in community banking, strategies for supporting small businesses, and its priorities for continued growth and resilience.

What were some key milestones over the past year?

2024 was a remarkable year for us. It was our largest production year since establishing ourselves in Southeast Florida, with nearly $1 billion in loan production, far surpassing any previous annual total.

This milestone reflects the vibrancy of Southeast Florida. Broward, Miami-Dade, and Palm Beach counties continue to attract significant business activity, and we’ve been very successful in capturing that momentum. It’s truly wonderful to be part of such a dynamic and thriving community.

How would you describe the landscape for community banking in Florida, and what differentiates Centennial Bank from other institutions?

Community banking in South Florida remains strong and healthy. The market is robust, but the biggest challenge lies in navigating regulatory hurdles. There’s tension between being pro-business and meeting compliance requirements developed in recent years. Balancing borrower needs, loan approvals, and compliance can be complex.

Smaller banks feel these challenges more acutely, as due diligence and underwriting processes are costly and time-intensive without directly generating income. Larger banks can absorb these costs more easily by focusing on larger deals and leveraging economies of scale, while community banks must manage the same regulatory demands with fewer resources.

That said, both community banks and regional banks like ours have found success in this market. South Florida offers loan opportunities across the spectrum, from $100,000 loans, which we handle very well, to $100 million loans, which we’re also equipped to manage.

Every bank finds its niche, creating a diverse and thriving ecosystem that ensures businesses and individuals have access to the financial services they need, whether for community reinvestment or small business loans. There’s more than enough opportunity for everyone.

Every bank finds its niche. This diversity is beneficial for the market because it ensures businesses and individuals have access to the financial services they need, whether that’s community reinvestment or small business loans. It’s a thriving ecosystem, and there’s more than enough opportunity for everyone.

How is the economic landscape influencing your strategies for lending, deposit growth, and customer retention?

Talking about interest rates and inflation can feel unpredictable. We’ve been caught off guard by how quickly and significantly rates have moved in recent years. For example, when rates were low, inflation surged. While we anticipated rate increases, the speed and magnitude surprised us.

As rates rose, things slowed, and inflation aligned with expectations. However, I think the three rate cuts happened too quickly in 2024. The first was expected, but the second felt excessive. 

I think rates should hold steady for now in the first quarter of 2025. The data remains mixed, and waiting for another 30 to 60 days wouldn’t significantly impact the market but would show the Fed’s commitment to controlling inflation. Dropping rates too quickly could seem politically driven or reactive. The Fed is like a parent. If the market misbehaves, the parent needs to stay firm. Caving too early sends the wrong message. Holding steady sets a tone of discipline and control.

How is Centennial Bank ensuring financial resilience and risk management?

We’ve taken a proactive approach to risk management. Since rates began rising and a few banks failed, we analyzed to ensure we could cover all uninsured depositors. Our lines of credit, Federal Home Loan Bank resources, and internal liquidity confirm we can meet obligations. Few banks can say the same.

Our model is straightforward but effective. For example, with rising rates, we reassess whether borrowers can handle repriced loans. Does the project still make financial sense? Should we re-amortize? What are the loan-to-value and loan-to-cost ratios? These critical questions help mitigate risk.

We’ve always maintained a conservative approach. Our corporate book averages under 65% loan-to-value, providing flexibility. If rates rise further or unexpected issues occur, we can work with clients to retain their properties rather than face foreclosure. Our goal is client success, not taking over properties.

This philosophy stems from lessons learned during the Great Recession when high leverage and minimal client equity created fragility. By ensuring significant equity in projects, we’ve maintained exceptional asset quality and minimal charge-offs over the years.

What trends are you observing in Florida’s residential and banking markets, and how is Centennial Bank adapting to meet changing customer demands?

We’ve seen shifts, especially with fluctuating rates. When rates dropped slightly, there was brief activity as projects were reassessed. However, we maintain strict standards: if a 1% rate increase makes a project unfeasible, it’s likely too risky to pursue. Thin margins aren’t sustainable, and we’re transparent about that.

Consumers are also holding onto cash more than expected. During COVID, programs like PPP increased liquidity, which eventually dissipated. But as rates declined slightly, we expected cash reserves to fund new projects. Surprisingly, people continue to save, and deposits haven’t dropped as much as usual during the holidays.

This focus on maintaining a financial cushion benefits banks by stabilizing deposits and reflects a broader shift in behavior. People are prioritizing long-term security over risky investments, ensuring their money remains accessible and secure.

How is Centennial Bank supporting small businesses in Florida?

Small businesses are the backbone of every community, and we’re committed to supporting them. Our SBA Express program processes small business loans quickly and efficiently, which is critical for entrepreneurs.

Many small businesses, like single-location restaurants, are expanding to second locations, fostering local recognition and strengthening communities. We also see production-based businesses scaling up operations.

Regulations have made lending to small businesses increasingly challenging. That’s why we focus on educating owners about what we’re looking for in loan applications and helping them present their businesses as viable.

Our goal is to help small businesses grow through expansion, production, or market presence. When they succeed, the entire community benefits.

What are your top priorities for Centennial Bank over the next couple of years?

Our success in 2024 — our best production year yet — came from building relationships and staying transparent with clients.

We focus on listening to customers, structuring loans to meet their needs, and being upfront if something doesn’t align with our expertise. Clients value our honesty and effort to explore all options, even when it’s a quick “no.”

Looking ahead, we’ll continue growing relationships, building our brand, and delivering consistent results. I joined Centennial Bank 25 years ago and moved to Florida nine years ago, at a time when few in this region had heard of us. Today, we’ve built a strong presence through word-of-mouth and our commitment to quality service.

We may not be as recognizable as national banks, but our reputation has grown through the relationships we’ve built, and that will remain our focus.

How do you balance a relationship-focused model with the demand for technology and innovation in digital banking?

Technology is essential, but relationships are at our core. Most clients prefer handling 80–90% of transactions digitally, whether through mobile apps or remote deposit capture. Even I do 95% of my banking on my phone. 

Still, when clients have questions or need assistance, they want to talk to someone who knows them. While technology improves efficiency, it can’t replace personalized service. For example, remote deposit technology now allows clients to deposit checks from their desks, saving them time to focus on their businesses. At the same time, our branches and call centers are staffed with knowledgeable people to handle complex issues.

Successful banks balance technology with human connection. Clients want both convenience and a trusted advisor, and that’s what we strive to provide.