There could soon be a new entrant into the league of elite Korean-American banks.
Saehan Bank, a small Koreatown institution, entered a deal this month that observers believe could give it the ability to buy competitors in the space and grow rapidly.
Under terms of the deal, Hana Financial Group, a large banking company based in Seoul, South Korea, will take a 51 percent ownership stake in Saehan for an undisclosed sum. The investment is subject to approval by U.S. and Korean regulators.
Stewart Kim, managing partner of L.A. investment bank PGP Capital Advisors LLC, said the investment could give Saehan a distinct advantage in the competitive Korean-American banking community.
“If approved by the regulators, this is a potential game-changer in the Korean community bank sector,” said Kim, whose firm previously has helped raise capital for Saehan but was not involved in this deal. “Capital is king and Hana Financial would bring lots of it. We feel it would probably accelerate M&A in this sector.”
Observers have long predicted a consolidation movement in the Korean-American banking industry, which has grown to more than a dozen institutions competing for a limited amount of business among immigrant entrepreneurs. Two of the largest institutions in the sector, Center Bank and Nara Bank, recently merged to form BBCN Bank, the largest Korean-American bank in the United States with $5.2 billion in assets.
Saehan, which has $563 million in assets, has long trailed the industry’s titans, which also include Hanmi Bank and Wilshire State Bank.
Hana hopes to leverage its networks to give Saehan new business opportunities, but it also expects additional growth through acquisition. Seung Yu Kim, Hana’s chairman, said in a statement that the investment was part of a strategy of “participating in the consolidation of financial institutions in this important market.”
The Saehan deal still faces a potential stumbling block with regulators.
Hanmi had entered a deal in 2010 that would have given Woori Finance Holdings Co. Ltd. a majority stake, but that transaction was called off last summer after failing to receive regulatory approval. However, one analyst who asked not to be named pointed out that Hanmi’s deal likely failed because Woori is partially owned by the South Korean government, which is not the case with Hana.
“The U.S. banking regulators have always been very hesitant to allow foreign government ownership of an American bank,” said the analyst.
Ready to Retire
After three decades with the Securities and Exchange Commission, the head of the local office is calling it quits.
The SEC announced last week that Rosalind Ramsey Tyson, director of the L.A. regional office since 2007, plans to retire at the end of March. A replacement was not named.
During her tenure in Southern California, Tyson oversaw a number of high-profile investigations, including actions against Angelo Mozilo, the former chief executive of subprime giant Countrywide Financial, who settled before trial. The office also took actions against several alleged Ponzi schemes.
“Through her tireless work and steady leadership of the Los Angeles office, Roz has been a key contributor to both the enforcement division’s unmatched record of protecting investors and the development of a smarter, more effective examination program,” SEC Chairwoman Mary Schapiro said in a statement.
Gores Group, a Westwood private-equity firm founded by billionaire Alec Gores, said last week that it has completed the acquisition of German manufacturer Hay Group through an affiliate.
Hay Group, based in Bad Soberhnheim, is more than 80 years old and has 1,600 employees. The company makes forged and machined components for the automotive and bearing industries at three manufacturing sites in Germany. Terms of the deal were not disclosed.
The deal follows on a number of recent acquisitions by the Gores Group, including purchases of data center operator Alpheus Communications in Houston and Trenton, N.J., logistical services company the Clark Group.
Cove Street Capital LLC, an investment adviser in El Segundo, has named Greg Farber director of institutional marketing and client services. … Investment adviser Beverly Hills Wealth Management has hired Bart Albrigo as senior vice president and wealth management adviser. … Entertainment Partners, a payroll provider in Burbank, has announced that John Hadity was hired as head of the newly created financing division.
Staff reporter Richard Clough can be reached at firstname.lastname@example.org or at (323) 549-5225, ext. 251.
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