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Groovin’ on the beach in a Shambhala Pyramid at the Live H2O Festival.

But bells aren’t ringing and nobody’s handing out wings—nor should they be—after the District Weekly broke the news last week that federal regulators have clamped down on ICB’s business practices. The reaction by Jane Netherton, the bank’s longtime president and CEO, wasn’t very George Bailey, either.

Netherton questioned the District Weekly’s motives for reporting on ICB’s condition, suggesting that it could create a run on the bank that would deprive Long Beach of the institution’s many good works. She minimized the problems itemized in a 23-page report from the Department of the Treasury. She indicated that the corrective actions mandated by the feds have been implemented and that whatever problems may have existed were typical of our times and have passed.

But it’s significant that Netherton and ICB’s board of directors—a who’s who of Long Beach’s most prominent power-brokers, including ex-Mayor Beverly O’Neill, Long Beach State president F. King Alexander and Jean Bixby-Smith—chose not to go public with the report from the Treasury Department’s Comptroller of the Currency. Since ICB is a privately held institution, no Securities and Exchange laws were broken, but it makes me wonder … is that something George Bailey would have done?

Meanwhile, back in the real world, I began to wonder even more. I’m a bit of a finance nerd—banking was my beat when I worked for the Orange County Business Journal—so I checked out ICB’s finances, and what I found isn’t good, despite what Netherton says.

Here’s a short explanation of the situation:

Generally, a bank’s strength is measured by its assets (ICB’s are $238.7 million), its return on assets (ROA) and its return on equity (ROE).  The ratios of ROA and ROE to those assets reveal a company’s profitability—as well as the skill of company management at using its assets to generate earnings.

Using those markers to evaluate ICB’s balance sheet, it’s no surprise that the feds stepped in.

In the period before they arrived, the numbers were dismal at best. ICB posted a negative 3.46 percent in ROA and a negative 30 percent in ROE. (For a closer look at the bank’s balance sheet, go to http://www.faqs.org/banks/International-City-Bank-National-Association-25648-Long-Beach-California.html#Assets.)

Those numbers have improved in recent months, although not enough to start celebrating. First quarter results, ending March 31, 2009, showed that the ROA slipped to negative 4.76 percent—probably due to calling in some bad loans—but that the ROE had improved to negative 9.1 percent.

On the up side, ICB currently exceeds all capital levels required for banks. Nonetheless, its 10.6 percent in core deposits still lags behind its peers, which have 11.8 percent in core deposits. The point is, while ICB’s core capital meets minimum standards, its numbers aren’t exactly stellar.

But that’s just my take on it. And frankly, it’s been 10 years, two kids, one dead pet rabbit and about 20 still-living fish in the aquarium since I’ve written a single word about the banking industry.

That’s why I turned to a real expert—a long-ago source named Norman Katz, a founder and managing partner of Irvine-based MCS Associates, which was founded in 1973 as a consultancy group but now offers legal witness services in both the finance and real estate sectors. Unfortunately, the current state of our economic climate puts expert financial witnesses like Katz in high demand. But he provided his evaluation of ICB for free.

“This is an interesting bank,” Katz summarizes. “The numbers speak for themselves. They have a low earning-to-asset ratio, low loan-to-deposit ratio, and a high level of non-performing assets – which worries regulators.”

ICBs predicament is so worrisome, says Katz, that the cease-and-desist order from the Department of the Treasury is more broad than usual.

“Obviously, there is significant concern about the value of some their assets that are not performing well – it could be their loans and it could be their investments,” says Katz. “But it appears that the regulators thought ICB’s problems were bad, and getting worse.”

ICB likely started to loose its footing after dedicating a significant portion of its assets into derivatives (interest-related income), while maintaining a relatively small loan portfolio.

According to Katz, other banks of comparable size have dedicated an average of 70 percent of their portfolios into loans, compared to about 45 percent at ICB – a move, he said, that has resulted in a highly-leveraged institution. That, in turn, has created fewer customer deposit dollars for ICB to pull from, which may have prompted the bank to turn to the Federal Home Loan Bank (FHLB)—created in 1932 by President Herbert Hoover to bolster home ownership—as a way to beef up its lending ability.

“That’s not necessarily a bad thing,” says Katz.  “Borrowing from a bank instead of customer’s deposits is sometimes financially attractive, but it’s also risky.”

Another worrisome indicator of ICB’s financial troubles is its increase in foreclosed assets of “other real estate.”  At the close of 2008, ICB had been forced to take over these troubled assets at a rate of 4.25 percent. Three months later, that number increased to 5.77 percent—not a huge jump, but well above  ICB’s banking peers, which averaged .65 percent.

At this point, it’s up to Netherton and ICB’s Board of Directors to fix the situation.  In fact, the Treasury Department is downright insisting on it—having requested that the board develop a written three-year strategic plan outlining established objectives and projections for ICB’s overall risk profile, earnings performance, growth expectations, balance sheet mix, off-balance sheet activities, liability structure, capital and liquidity adequacy, and product line development and market segments that the bank intends to promote or develop.

Accomplish all that, get ICB back in the black, and it’ll be shiny new wings all around.

(Our oldest Masonic Temple is farther downtown, on Pine Avenue–though it, too, is no longer a temple.)

It’s still a stately place–though approximately 100 percent less creepy since its remodel. I had the good fortune to know someone who lived there in the late 1980s–actually rented most of a floor–and it was incredible.

Hallways jammed with junk; dogs running around (they belonged to the owner); upright pianos scattered here and there; old refrigerators and hi-fis; and an entire roomful of those tins of Civilian Defense biscuits we were supposed to dig into, in the event of a 1950s nuclear war.

The Masons didn’t find all that stuff–the Temple’s then-owner did. I suppose you might say he was a bit of a … packrat? Perhaps.

Anway, an awesome place then–and still pretty cool now. Check it out.

We’re not exactly sure how this is supposed to stimulate the economy—who and how many additional workers this will employ, what company makes the new equipment—and the story didn’t say. And while we’re all in favor of reducing air pollution, the actual amount of retrofitting won’t exactly allow us to breathe that much easier; as Hanson reports, the money will help the port replace and retrofit only 112 pieces of this equipment out of the 1,000 or so in use.

Meanwhile, plans for the vast Port of Long Beach inner-harbor expansion continue.

Farmers Market: Farm to table. 3-6:30pm.
BIXBY KNOLLS Atlantic Ave and E 45th, Long Beach 90807. goodveg.org.

Grand Elegance: With Psychic Ills and Indian Jewelry. 10pm. 21+.
THE PROSPECTOR 2400 E Seventh St, Long Beach 90804. 562.438.3839; myspace.com/theprospectorlongbeach.

Steve Soto and the Twisted Hearts: With Cowboy and Indian and more. $5. 21+.
ALEX’S BAR 2913 E Anaheim St, Long Beach 90804. 562.434.8292; alexsbar.com.

Cal Heights Neighborhood Association: Monthly meeting. 7pm.
PETROLEUM CLUB 3636 Linden Ave, Long Beach 90807. calheights.org.

Omelets / $4.99  for a limited time
Served with fruit and toast
#1  Shiitake mushroom and crab with red bell peppers and green onions
#2  Spinach and feta, sundried tomato, potatoes and fresh herbs
#3  Chili and cheddar cheese omelet

Eggs any style / $4.99 for a limited time
Two organic eggs, applewood bacon and hashbrown potatoes and toast

Favorites / $4.99 for a limited time
Whole wheat and honey blueberry pancakes with fresh whipped vanilla cream
Cinnamon and spice French toast roasted banana and vanilla rum sauce
Breakfast burrito
scrambled eggs, bacon, soyrizo, potatoes, avocado and cheddar cheese

Breakfast Bowls / $4.99 for a limited time
Hashbrown potatoes and scrambled eggs mixed with your choice of:
turkey tenderloin freshly ground, green onion, mushroom and cheddar
angus sirloin freshly ground, diced tomato, potatoes, onions, chopped herbs
soyrizo, salsa, avocado, sour cream

Specialty Sandwiches / $4.99 for a limited time
Southwest Panini
Scrambled eggs, soyrizo, jalapeno salsa and pepperjack cheese

E.B.L.T. with Avocado
Two eggs, applewood bacon, lettuce, tomato and avocado
served on a sesame poppy seed bun

Sides
fresh fruit cup  $3.00
applewood bacon, three slices $2.50
hashbrowns $3.00

The Equal Benefits Ordinance (EBO), which Garcia has placed on the July 14 council agenda, would require most companies doing business with the City of Long Beach to offer the same spousal benefits packages to all employees, straight or gay. If the spouse of a married employee receives benefits, then the legally registered domestic partner of a gay employee must receive benefits, too. That’s it.

The Press-Telegram was the first to post a story on the EBO—based on Garcia’s press release—this morning, and its readers began convoluting and misinterpreting this simple proposal almost immediately. Confused and angry, people started calling his office, too.

“People seem to think that the Equal Benefits Ordinance will force companies to hire more gay employees or to begin offering spousal benefits … or something,” Garcia said, calling the District Weekly to clarify an earlier conversation after the shit started hitting the fan. “The ordinance would simply close a loophole.”

City staff has indicated that the loophole can be closed without significant expense, too, says Garcia.

“The change would boil down to one more question that applicants must answer on the regular Request for Proposal process that the city already has in place for contracts,” he says. “And compliance would be determined as part of the same audits that are already in place.”

The ordinance would allow for some exceptions to be made by the city manager, such as in cases of public emergency, small contracts and vendors and other similar circumstances.  The ordinance would also not apply to businesses that do not offer spousal benefits. The ordinance only applies to businesses that do business with the city.

Garcia heralds the EBO as “historic,” but that’s only true as far as Long Beach history is concerned. The councilmember’s own press release acknowledges that “the state of California has an EBO in place, as do other large cities including Los Angeles, Oakland, Seattle, San Francisco, Portland and Minneapolis.”

In some ways, that makes the proposal even more important.

“We are thrilled that Councilmember Garcia has proposed this historic ordinance,” said Kimberly Woods, Executive Director of the LGBT Center in Long Beach, in Garcia’s press release.  “The LGBT community is united in supporting this important measure.”

“Long Beach is an internationally recognized leader in equal rights for the lesbian, gay, bisexual, and transgender (LGBT) community,” said Second District councilmember Suja Lowenthal—who is co-sponsoring the proposal—in Garcia’s press release. “We need to show leadership when it comes to equality for all.”

Historic or not, Randy Gordon, CEO of the Long Beach Area Chamber of Commerce, wasn’t quite as excited about the Equal Benefits Ordinance. He issued a press release that kind of hemmed and hawed and then announced that he didn’t have an opinion, either way. Here’s how Gordon put it.

“The Chamber supports Councilmember Robert Garcia’s aggressive action relative to his beliefs so early in his term. However, we understand that an EBO is a trend in many cities with wide support and also has the needed support of Long Beach City Council to pass. The Chamber likewise understands that business is simply unable to sustain increased governmental expense requirements in the current recessionary environment. Therefore, the Chamber will remain neutral and will not take a position on Councilmember Garcia’s Equal Benefits Ordinance.”

For more information on the proposal, including the facts of the plan and to find out what other cities are doing, log on to: www.robertgarcia.com.

But getting posterized by a college kid apparently didn’t sit so well with King James nor the company that pays him millions to wear and hawk its shoes. According to Gary Parrish of CBSsports.com—who witnessed the dunk—Nike executive Lynn Merritt confiscated evidence of the play that was videotaped by freelance photographer Ryan Miller.

Wiener!