Douglas Schneider answers quickly when asked if he and his business partner hesitated to expand in a recession.
"Absolutely," said Schneider, co-owner of Excalibur Manufacturing south of Brooksville. The company does custom injection molding for components in products ranging from sprinklers to mine sweepers.
But with the economic downturn came opportunity in the form of lower construction costs and shorter wait times for permits, so Schneider and partner Wade Thomas decided to go ahead with plans to expand their existing plant at the county's airport industrial park. They landed a business loan and just finished a 9,600-square-foot addition, doubling their space to make room for production machinery and storage.
"We got to the point where we said, if we're going to do it, now is the time," Schneider said. "The economy is going to improve. We're already starting to see signs."
Excalibur bucked a nationwide trend. Banks last year saw their biggest full-year decline in total loans outstanding in 67 years, according to the Federal Deposit Insurance Corp.
Banks saddled with troubled assets in the form of foreclosed properly and delinquent loans have been less willing to lend money. Consumers and businesses are buckled down in the face of high unemployment rates.
Hernando's jobless rate is hovering near 15 percent. Still, local bank officials say they have money to lend and are beginning to see at least some initial signs that consumers and businesses may be ready to do their part for a turnaround like Excalibur did.
"I see them talking about it. I don't see them doing anything," said Morris Porton, senior vice president of Florida Traditions Bank, which gave Excalibur its loan. "Most people are in savings mode."
Based in Dade City, Florida Traditions formed in 2007 and opened its first Hernando branch in 2008. That means the institution is not struggling under the weight of bad loans, Porton said.
Meanwhile, another local bank is looking to avert a crisis.
Cortez Community Bank, a 6-year-old operation headquartered in Brooksville and hit hard by delinquent commercial loans, announced last week a pending deal to sell a majority of its stock to a South Florida real estate and pension management firm. The sale would bring in about $15 million in capital, Cortez president Don Page said.
As developers struggled, other segments of the banking business dried up, too, Page said. Cortez got out of home equity loans because equity has all but disappeared and people who qualify to refinance are upside down. Auto dealers desperate to get customers onto lots started to offer zero percent financing, taking that business away, too.
"We're not making many loans," Page said.
The county's largest player in terms of market share has plenty of money to lend, said Jim Kimbrough, chief executive officer of SunTrust Bank/Nature Coast.
Kimbrough acknowledged that the current climate is the worst he's seen in 42 years in the industry. Credit requirements have been ratcheted up.
"We've always try to find a way to say yes, and we still do that," he said. "But with the regulatory pressure of the current economic times, it presents additional challenges for people in the banking industry."
During Hernando's recent boom years, the number of bank offices and deposit totals grew with the population.
In 2000, the county had 35 offices, and customers deposited $1.7 billion. Seven years later, those numbers had climbed to 43 and $2.9 billion, respectively.
Deposits started to decline in 2007, falling to $2.3 billion by last June. The number of bank branches decreased by two.
The banking landscape in Hernando has changed only slightly in recent years, though. SunTrust, Bank of America, Wachovia and Regions Bank still account for three-quarters of the total deposits in this market of 13 institutions, according to the FDIC.
Superior Bank has climbed a couple of notches to No. 5, boasting about 5 percent of the market share.
Officials with banks large and small say they still see Hernando as a growth market. They are eyeing key indicators such as real estate prices and the inventory of existing homes.
Recent figures show that the former is stabilizing and the latter is ready to move away from glut status, Porton said.
"Every day that goes by, in my mind, is a day closer to recovery."
Tony Marrero can be reached at (352) 848-1431 or firstname.lastname@example.org.