Russell Goldsmith is about to pass his crown to an unlikely heir: Matt Wagner.
In case that name doesn’t ring a bell, Wagner is the low-profile and press-shy chief executive of Century City’s PacWest Bancorp, and he’s about to become L.A.’s biggest mainstream banker.
Once Royal Bank of Canada acquires Goldsmith’s downtown L.A. institution, City National Corp., and once Livingston, N.J., lender CIT Group Inc. closes its acquisition of Pasadena’s OneWest Bank, PacWest will become the biggest nonethnic lender with its corporate headquarters in Los Angeles, replacing City National.
City National Bank will keep its name and local offices and Goldsmith will likely remain involved in civic affairs. But it’s yet another example of an L.A. company that will no longer be owned locally and whose executives, long answerable only to their own shareholders, will now have out-of-town bosses.
Banker and civic booster Alan Rothenberg thinks the city’s loss of big companies makes it more difficult for Los Angeles to, among other things, compete with other big cities for marquee events such as the Olympics.
“One of the difficulties in civic projects in the city is that there aren’t enough big institutions that have huge budgets that commit to the city,” he said. “The publicity is always how many lost jobs (when a company leaves). They get filled in a way, but civic impact doesn’t.”
Rothenberg, the chairman of Century City’s 1st Century Bank, remembers how that lack of heavy hitters nearly derailed plans to bring World Cup games to Los Angeles in 1994.
Rothenberg, who was president of the United States Soccer Federation at the time, recalled that each bidding city had to raise $500,000 to cover initial costs. In Chicago, late hotel magnate Jay Pritzker raised the money in the course of a single meeting of local business leaders, Rothenberg said. But Los Angeles was struggling.
“They were basically having bake sales to raise the money,” he said, crediting late Mayor Tom Bradley for saving the effort with last-minute cash from the port and convention budget.
Since then, the city’s lost more major corporations such as oil producer Atlantic Richfield Co., First Interstate Bancorp, and most recently, Occidental Petroleum Corp.
Big companies, and particularly banks, often play leading roles in their communities.
Farmers and Merchants Bank has been in Long Beach since 1907. The Walker family has been there since day one. And the current chief executive, Daniel Walker, says his family has taken on a certain responsibility in the Long Beach and northern Orange County neighborhoods the bank serves.
“We were involved from the beginning when Long Beach Memorial Medical Center was created and built,” said Walker of the city’s flagship hospital, which was born the same year as the bank. “We were the first lender on the Crystal Cathedral in Garden Grove.”
Without having a local banking partner deeply woven into the fabric of the community, it’s hard to say if those projects would have got off the ground as easily. But having a world-class hospital in Long Beach was critically important to the Walker family.
Goldsmith has recently used his considerable local sway in other ways. He chairs the Los Angeles Coalition for the Economy & Jobs, a group he says is there to find common ground between business and labor leaders.
“I knew enough of the people where I realized I could be a catalyst to bring people together,” he said.
Compare that with the new face of L.A. banking: Wagner, a virtual unknown in civic life who did not return calls, emails or letters seeking comment for this report. He’s a notable departure from Goldsmith, Walker and other bank chiefs who play some kind of leading civic role. Rothenberg is chairman of the Los Angeles Tourism and Convention Board. East West Chief Executive Dominic Ng is a USC trustee.
While Goldsmith insists he’s not going anywhere and that City National will still be a big local player, the changing faces of L.A.’s corporate leadership has Rothenberg feeling nostalgic for the days when Los Angeles could host the world with the Olympics.
“When we had a group of big companies with big leaders, if the mayor said, ‘This is important,’ unless they thought he was crazy, it was, ‘Let’s go,’” said Rothenberg. “And boom, it was done.”
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