BayFirst Financial in Florida picks president to be next CEO

BayFirst Financial Corp. in St. Petersburg, Florida, said Monday it lined up its next chief executive.

The $939 million-asset bank said Thomas Zernick would succeed current CEO Anthony Leo at the start of 2024. Zernick was also appointed as a director to the company's board effective immediately, the bank said in a press release.

Zernick, who has been president of BayFirst since February 2022, previously was head of the company's CreditBench division, which provides government-guaranteed loans to businesses throughout the nation. He joined the company in 2016.

Thomas Zernick, President of BayFirst Financial's BayFirst National Bank unit
BayFirst President Thomas Zernick

Leo, who will remain a director and also serve as special counsel for strategic matters next year, has led the company since 2013. During his tenure, BayFirst grew from a small community bank with $69 million of assets.

"It has been an honor to serve as CEO of BayFirst during this period of growth and transformation, and I want to express my sincere appreciation to our board of directors for their support and to our employees whose hard work and dedication have allowed us to achieve so much," Leo said in the release.

One element of the bank's growth, however, is going away. BayFirst in September last year started the process of discontinuing its nationwide network of residential mortgage production offices. In a release, the bank cited a "precipitous decline in mortgage volumes and the uncertain outlook for mortgage lending over the coming quarters."

Mortgage banking had boomed in recent years — when interest rates were low — and several community banks, including BayFirst, expanded their home loan operations beyond their traditional footprints to capitalize. But demand plummeted in 2022.

To combat inflation, Federal Reserve policymakers hiked interest rates multiple times in 2022 and again early this year. The Fed's benchmark rate is now the highest it has been since 2008. Mortgage rates doubled last year and remain elevated, putting downward pressure on home buying.

"Given the impact of declining mortgage volume on the company's operating performance in recent quarters, together with the uncertain outlook for mortgage lending in the near- to mid-term, we made the difficult decision to discontinue our nationwide network of residential mortgage loan production offices," Leo said in September. 

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Community banking C-suite
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