Credit Union Faces Future With Video-Chat App

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While mobile banking is a godsend for those who are more likely to have a smartphone than a checkbook handy, there are certainly some people who lament losing the personal touch they get when going to a branch. But one local credit union wants to give its customers the best of both worlds.

El Segundo’s Xceed Financial Credit Union has launched what it calls the “Xperience Center,” a feature on Xceed’s mobile app that offers face-to-face video chats with bank employees and financial advisers.

“The majority of the financial institutions are using technology as a replacement or a cost-cutting process,” said Xceed Chief Operating Officer Ray Shams. “We are truly using our technology as an enhancement to our existing manpower. It’s designed to provide our members with a better, faster and more convenient experience knowing there’s a live person on the other end.”

The Xperience Center officially launched in June. Advisers are available from 6 a.m. through 6 p.m. Pacific time on the app; starting next month, they’ll be around 24-7, able to assist clients who might be traveling abroad – or have some pressing questions in the middle of the night.

Xceed Chief Executive Teresa Freeborn said she’d eventually like to have advisers that speak Spanish, Mandarin and other languages available remotely.

As more and more customers take advantage of online and mobile services – and fewer come into branches – many banks have faced the challenge of effectively using branch office space. Who needs six tellers in the middle of a workday anymore?

Russell Goldsmith, chief executive of downtown L.A.’s City National Bank, told the Business Journal earlier this year that his bank has removed some teller windows and replaced them with desks where bankers can issue loans and provide other services, trying to capture some business that is harder to replicate through its mobile app.

“People want multiple channels and a lot of times they just want to do it on their smartphone,” he said. “But when somebody wants a mortgage or they need investments or they need a line of credit for their business, that’s something that’s much harder to do over the Internet.”

That’s why Xceed wants to add the human element to its technology, not replace it.

“Xperience Centers are truly a tool that we have to expand our reach,” Shams said. “This is not a replacement or a cost-cutting gimmick. We’re not pulling our people out and replacing them with a glorified ATM.”

Blank Check

Beverly Hills private equity firm Gores Group has raised several private funds, tapping into well-heeled investors and institutional money. But its latest move is open to the public.

On Aug. 19, Gores Holdings Inc., an entity controlled by the firm, announced that it had completed a $375 million initial public offering. Its stock trades on the Nasdaq under ticker symbol “GRSHU.”

Gores Holdings sold 37.5 million units at $10 apiece, with each unit entitling the holder to one share of Gores Holdings common stock and one warrant to buy a half-share at $5.75. The proceeds will go toward making an acquisition – one that hasn’t been identified yet. If the company cannot complete a deal within 24 months of the offering, it will redeem all of the shares in cash, plus interest.

While this type of company, called a “blank check,” is a first for Gores Group, it’s hardly a new tool for local investors.

In 2013, veteran L.A. entertainment executives Harry Sloan and Jeff Sagansky formed Silver Eagle Acquisition Corp., which completed its purchase of Indian pay-TV operator Videocon d2h on March 31.

One advantage of the blank-check

structure is that it allows a company to raise money for a future acquisition while giving investors easily tradable stock while they wait. A source close to Gores said the structure also provided an opportunity to dedicate a pool of capital to pursue acquisitions that might be too small to fit into the private funds the firm typically raises, which can reach $10 billion.

The blank-check company might also be used to buy a company Gores intends to hold for a long time, as opposed to the seven-year harvesting cycle common to private equity.

But critics, such as Bloomberg’s Matt Levine, argue blank checks can be used to give private companies a way to go public while avoiding the scrutiny that comes with a typical public offering.

A Gores Group spokesman declined to comment on the IPO.

C-Suite News

New York accounting firm Marcum has named Arthur Brown a partner in its L.A. office. Brown, who was formerly chief financial officer at a hedge fund, will lead the firm’s alternative industry group practice in California. … Mid-Wilshire’s Broadway Financial Corp. has named Erin Selleck to its board. She was formerly a senior executive vice president and treasurer at Union Bank.

Staff reporter Matt Pressberg can be reached at [email protected] or (323) 549-5225, ext. 230.

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