Bank big shots eying Ga. applies to start bank in Fla.
A group of national banking all-stars said to have their eyes set on failed bank deals in Georgia and throughout the Southeast have applied with Florida regulators to start a bank in the Sunshine State.
Bank of the Southeast, said to include backers including a former Federal Deposit Insurance Corp. chairman, and the former head of the Federal Home Loan Bank of Atlanta (FHLB Atlanta), have applied for a charter with the Florida Office of Financial Regulation’s Division of Financial Institutions.
The group, said to include former FDIC Chairman William Issac, also boasts ex-FHLB Atlanta Chairman Ray Christman and Office of Thrift Supervision’s former Southeast regional director, John E. Ryan, among its principals.
The charter application—along with a separate bid including former Bank of America Corp. heavyweights—was first reported Thursday by Jacksonville Business Journal, a sister publication of Atlanta Business Chronicle.
The Chronicle first reported about Bank of the Southeast and its interest in failed banks Feb. 26.
The group is seeking to initially raise about $500 million from institutional and individual investors, sources have previously told the Chronicle. The group could likely raise upwards of $1 billion.
The group said in the filing it is based in Ponte Vedra Beach, Fla. In the filing, Ryan is listed as chairman of the banking company, and his registered address is in Colony Square in Midtown Atlanta. Bank of the Southeast would be a subsidiary of BSE Management LLC. The group has also filed for a business license in Georgia, according to the Georgia Secretary of State’s Office’s Web site.
David M. Moffett, former CEO and director of Freddie Mac, will be president and CEO of both the bank and its holding company, Bancorp of the Southeast LLC.
Other key players involved are: Roger Helms, former First Union CEO of the Florida market; Cecil Sewell, former chairman of RBC Centura Banks and former chairman and CEO of Centura Banks of North Carolina; former SunTrust Banks Inc. executive vice president William Serravezza; and former SunTrust Vice Chairman John Clay.
The proposed board of directors also includes some veteran Florida bankers such as Robert Helms, retired president and CEO of Wachovia Bank of Florida, and the former chairman, president and CEO of SunTrust Bank in Florida, George W. Koehn.
Private equity has been seen as a potential savior of banks, bringing needed capital to stabilize one of the foundational industries of the nation’s economy.
Georgia leads the nation with 37 bank failures since August 2008, and private equity-backed players have gobbled up 12 of those lenders (including the six bank subsidiaries of Security Bank Corp. of Macon).
Isaac, the former FDIC head, has been linked to the group, but was not included in the executives proposed in the filing, which was dated in February.
Sources within the Atlanta banking community have said the team previously had inquired about acquiring a healthy Peach State lender and using it as a platform to go after ailing institutions in northern Florida and Georgia.
The wave of private equity-backed buys that had been expected for more than a year might be on the verge of cresting.
Capital willing to invest in failing banks is mushrooming on the sidelines, industry sources say. Bank of the Southeast would join a growing field of private equity-backed bank management teams scouring the region.
At least a half-dozen private equity investor groups have been rumored to be eyeing Georgia, in addition to the two that have successfully completed deals here in the past year.
Milton Jones, the former market president for Georgia for Bank of America Corp., is known to be heading a $1 billion group of former Wachovia Corp. and BofA big shots seeking a “shelf charter” from federal regulators that would enable them to buy failed banks.
Also Thursday, Jacksonville Business Journal reported North American Financial Holdings Inc., a group led by former BofA Vice Chairman Eugene Taylor, has applied with the Office of the Comptroller of the Currency for a charter. The group is armed with more than a half billion in investor capital.
Nearly 200 banks nationwide have failed since the current banking crisis began in 2008, and more than 700 banks are on the FDIC’s so-called “problem list.”
Filed under: money by Specialist