Los Angeles was ground zero for a nationwide movement to encourage bank customers to switch to credit unions, but that didn’t seem to have much of an impact on local institutions.
Credit union membership in Los Angeles County remained static during the fourth quarter at 2.8 million, a slight decrease for the year, according to data provided to the Business Journal by the California Credit Union League trade group.
However, experts said the number was an improvement over 2010, when L.A. credit union membership fell by 3.5 percent.
Tom Glatt, founder of Wilmington, N.C., credit union consulting firm Glatt Consulting LLC, noted that the L.A. housing market was hit particularly hard during the downturn, and with continued high unemployment the area has been slower to recover than some other markets.
“California in particular wasn’t exactly the best place to be during the recession,” Glatt said. “To get (membership growth) back to a flat line is probably a good thing.”
Diana Dykstra, chief executive of the California Credit Union League, said the industry typically purges inactive accounts at the end of the year and therefore membership declines. So just staying flat is a win.
Statewide, membership was up about 2 percent, which industry leaders attributed largely to the grassroots movement known as Bank Transfer Day. Dykstra said credit unions across California added about 167,000 members as a result of the campaign, which tried to convince customers of big banks to switch their accounts to credit unions.
Bank Transfer Day started in Los Angeles after a local art gallery owner launched a Facebook page complaining about rising fees at big banks.
Though the hype has mostly died down, Dykstra said some credit unions are still gaining customers.
“They’re continuing to see heightened membership,” she said, “but not at the same pace.”
A federal judge has dismissed a year-old class-action lawsuit filed by shareholders against Wilshire Bancorp Inc.
The lawsuit accused the Korean-American bank holding company of failing to disclose problems with its lending procedures that eventually contributed to losses of tens of millions of dollars. The lawsuit was filed last March after the Koreatown institution revealed that it was adjusting previous earnings downward due to certain loan underwriting deficiencies.
Joanne Kim, then Wilshire’s chief executive, resigned in February 2011 for failing to provide adequate oversight, the company said in a regulatory filing. She was replaced by banking veteran Jae Whan Yoo.
Wilshire said it has addressed the problems in its underwriting.
The Business Journal reported last year that, prior to Kim’s departure, the chief marketing officer was ousted amid accusations of improper lending practices.
First General Bank, a small Chinese-American lender in Rowland Heights, has been named one of the best performing banks in the United States.
First General, which has $507 million, placed sixth overall in a ranking of the nation’s top community banks. To compile its list, industry research firm SNL Financial examined a variety of factors, including profitability and asset growth over the past year.
Just two other county banks made the list: downtown L.A.’s Royal Business Bank at No. 71 and Farmers & Merchants Bank of Long Beach at No. 89.
First General, a seven-year-old bank that recently acquired two small competitors, had a net interest margin of more than 4 percent and asset growth of 120 percent during 2011.
Imperial Capital LLC, an investment banking firm in Century City, has appointed Tom Corcoran president. Current President Randall Wooster will become chief executive. … Century City investment banking firm Houlihan Lokey has hired Ryan O’Toole as a director in its aerospace, defense and government group. … City National Bank, the subsidiary of downtown L.A.’s City National Corp., has hired Angel Chen as a senior vice president in the private client services division and team leader in the Pasadena office. … Farmers & Merchants Bank of Long Beach has hired Frank Coleman as a chief auditor for the bank’s 21 area branches. … Union Bank, owned by San Francisco’s UnionBanCal Corp., has hired Susie Lee as a vice president and business client adviser in the business banking group. She will be based in Los Angeles. … San Diego’s Torrey Pines Bank announced that Leo Schafer was promoted to senior vice president in the bank’s downtown L.A. office. … Robb Evans, founding director of Beach Business Bank in Manhattan Beach, was named Distinguished Banker of the Year by the California Bankers Association.
Staff reporter Richard Clough can be reached at firstname.lastname@example.org or at (323) 549-5225, ext. 251.