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Friday, Oct 7, 2022

Exec Capitalizes on Connections to Start Bank

When Don Griffith, a veteran of the local banking scene, set out to start a de novo bank two years ago, he didn’t anticipate the near meltdown of the financial services industry.

So after the financial crisis in late 2008 derailed his plans, Griffith took a different tack. He accessed a deep Rolodex developed over decades of banking and raised $335 million. Rather than try to navigate the increasingly complex regulatory environment to get approval for a new bank, he used some of the money to buy an existing Orange County bank and convert it into a new institution.

“In this environment, I thought it would probably be quicker to buy a little bank,” said Griffith, 66, previously chief executive of El Segundo’s First Coastal Bank, which was sold in 2007. “Given my background, I was blessed to know a lot of people and the capital was out there for the right story.”

He used that bank, Santa Ana Business Bank, which he took control of June 18, as a platform to start his own institution in downtown Los Angeles: Grandpoint Bank, which officially launched last week.

The bank, started with a $75 million capital commitment, will primarily cater to small businesses and high-net-worth individuals. Santa Ana Business Bank’s office, meanwhile, is being converted into a Grandpoint branch. Later this year, a third location is planned for the South Bay.

Grandpoint is Los Angeles County’s first new bank since California General Bank, a business bank in Pasadena, opened in March 2009. Unlike Grandpoint, however, California General was started from scratch as a de novo.

Grandpoint President Jan Cloyde said the bank has roughly 40 employees, many of whom were poached from competing banks.

“These are experienced bankers that we’ve brought on,” said Cloyde, a former City National Bank executive who came out of retirement to join Grandpoint.

Top Thrift

L.A.’s third largest thrift may actually be the best, according to a new report.

Malaga Financial Corp., the Palos Verdes Estates parent of Malaga Bank, was ranked as the top performing thrift in the United States, according to data from SNL Financial, an industry research firm. The report examines the financial performance of thrifts over the past year, including return on average assets, efficiency ratios and levels of nonperforming assets.

Malaga, which has $829 million in assets, ranked at or near the top in every individual category. With a composite score of 95.8, the thrift ranked well ahead of No. 2, Hingham Institution for Savings in Hingham, Mass.

K-Fed Bancorp was the next highest-ranked local institution, coming in at No. 35.

Hefty Investment

Imperial Capital Group Inc., the Century City investment bank, announced last week that it has helped a Southern California homebuilder secure a substantial private equity investment.

The firm negotiated a $100 million investment in Santa Ana-based City Ventures LLC by an affiliate of Ares Management LLC, a private equity firm headquartered in Century City. The move will make Ares the largest stakeholder in City Ventures, which also is backed by Imperial Capital.

City Ventures, which focuses on urban development, said it will use the investment to expand its efforts in developing homes in supply-constrained coastal regions of Southern California.

Deployed Capital

Colony Financial Inc., the real estate investment trust subsidiary of billionaire Thomas Barrack’s Colony Capital, announced last week the closing of the acquisition of First Republic Bank.

Colony invested $24 million in the $1.86 billion management-led buyout, which re-establishes the bank’s independence after a tumultuous three years.

First Republic, a San Francisco institution with six branches in the L.A. area, was acquired by Merrill Lynch in 2007 for $1.8 billion. But First Republic was put up for sale last year by Bank of America Corp., which acquired Merrill in early 2009.

Colony, which went public in September, said it has deployed $256 million, or 93 percent of the net proceeds, from its initial public offering.

C-Suite News

Houlihan Lokey, a global investment banking firm headquartered in Century City, announced that it has hired Eileen Kamerick as managing director and chief financial officer. … First Republic Private Wealth Management, the money management division of First Republic Bank, has hired three new managing directors in its Century City office. The new hires – Barbara Bruser, Pamela Bennett and Rod Olea – all came from City National.

Staff reporter Richard Clough can be reached at rclough@labusinessjournal.com or at (323) 549-5225, ext. 251.


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