Loans for green roofs and energy-efficient heating helped boost ShoreBank Corp.'s conservation loan portfolio by 16 percent from a year earlier.

"It fits so well around what we currently do around multifamily rehabs," said ShoreBank President Anne Arvia. The roster of borrowers from the South Side bank are starting to include energy efficiency measures into gut rehabs, so sometimes a conservation loan and a community development loan are made for the same project, Arvia explained.

"Our borrowers are starting to see that energy efficiency makes so much sense," Arvia said. She said it helps that the City of Chicago is pushing for "green" rehab and development.

Conservation lending focuses on the promotion of efficient energy use and alternative forms of energy, efficient use of materials and resources, and protection and revitalization of land and water.

This type of lending, which totaled $187.8 million in 2005, represented 36 percent of ShoreBank's total loan originations.

The bank has $1.08 billion loans outstanding.

ShoreBank reported that its net income for 2005 was ahead of budget at $8.35 million, 11 percent higher than in 2004. The bank company more than doubled its net income in five years -- from $3.01 million in 2001.

New community development loan funds increased by 7 percent over 2004. The bank reported that both net income and loan originations were at their highest level in the company's 32-year history.

"There's been a lot of focus to do what we do well," said Arvia, regarding the improving statistics.

In 2004, the privately held bank reported consolidated net income of $7.5 million, ahead of 2003 but 13 percent less than budgeted. The earnings were below budget because of greater-than-expected losses at ShoreBank Advisory Services and at its Pacific and Cleveland bank subsidiaries.

ShoreBank has since restructured its Advisory Services arm to focus solely on international microfinance consulting, and changed the name to ShoreBank International. Shorebank also consolidated operations at the Cleveland bank, making it a branch of the Chicago bank. This allowed the Cleveland bank to increase its legal lending limit on loans to $20 million from $1 million.

"They've been freed up to lend more money," Arvia said.

ShoreBank also continues to negotiate for the purchase of Greater Chicago Bank in Bellwood, a $65 million community institution, Arvia said.

She said ShoreBank hopes to sign a purchase agreement "by the end of next week." The last acquisition by ShoreBank was in 1995 when it acquired Indecorp.

mwisniewski@suntimes.com

- - -

Started in 1973 by Mary Houghton, James Fletcher, Ron Gryzwinski and Milton Davis, ShoreBank focuses on community development. The South Side institution has invested more than $2 billion in underserved U.S. communities since its founding.

Other ShoreBank stats:

- $1.8 billion in total assets in 2005. This is compared with Chicago's largest bank, New York-based JPMorgan Chase, which had about $1.2 trillion in assets in 2005, while MB Financial had $5.7 billion.

- ShoreBank employs 480 throughout the U.S. and internationally, of which 71 percent are African American.

mwisniewski@suntimes.com