Big backers aim to build local banks - Dallas Business Journal:

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The practice has netted millions for Texas bank CEOs and theilocal investors. Now, big institutional investors are following the same game Instead of startinganother bank, former bank CEO Nigelk Harrison instead chose to build a bankinv company called , backed by institutional that aims to build a string of medium-sized communit bank franchises. That's a common achievement for the big-bank operations when they arrivde in a new but FC, the parent operation of , is tryingh to build a network of locall operations. It opened its second office, at Coit Road and Interstats 635 inNorth Dallas, on March 3. Harrison'd FC Holdings Inc.
aims to open a half-dozen Dallas bank offices in the first halfof 2008. "Wd provide the capital and back office, and they get the opportunithy to go out and do what they do said Harrison, who sold a priod institution called to for $123 million in 2005. In addition to his own money andlocal investors, FC Holdings landed a $150 millionb commitment from , a New York City privat equity firm. FC Holdings used the first $75 million of that deal to acquireFirst , in the town of Crockett, last November. "A s I can testify myself, raising money is hard work," said Jim a former bank CEO and senior managingt director of Commerce Street Capitalin Dallas.
"Once got JLL, that's it. He's got his money tied up." Whil they can provide more capital inone shot, institutions are more likely to push bankersd for an exit strategy than individual investors, Gardner said. Gardner's Commerce Streetr is an institutional investor in 28 community banksin California, South Carolina and other states. In most instances, the formere boss goes with thebank that's sold. In he chafes at beinfg part of a larger organization and leavee to startanother bank. That is what led Gerole Hooker, at age 62, to starr instead of retiring.
Hooker was CEO of , which sold in 2002 to and has grown by acquisition to be the 12th biggest bank in the In starting thenew bank, Hooker said it was good to "get away from the institutional feel and a cookie-cuttetr bank." Hooker's new institution, Bank of Las raised $8 million in start-uo capital, with 51% comintg from Michigan-based (NYSE: CBC), whicb has backed 62 community bank startups, mostly in the Southwest and California. Hookeer and his No. 2 man, Brad chief credit officer, could have raised the moneg fromlocal investors, but Capitool Bancorp brings administrative support in addition to its $4.08 million to the "The value is that back-roonm operation.
They handle legal, accounting HR, all that stuffg that's not fun," Tidwelll said. "The fun part is takingy care of customers and doing deals. That's what we want to focuws on." His first two Texazs ventures, Las Colinas and Bank of Fort got startedin December. Las Colinas officially opene d forbusiness Dec. 13 and finishecd the year with $11. 4 million in total assets, including $9.7 millionm in net loans and leases. Local bank chiefz in Texas are able to sell and stargt over because big banks must have a structurewthat doesn't allow for the same agility and customee service that locally owned banks offer, Harrison Big local banks run into that as well.
"Aftedr running over half a billion (in assets) I startee bumping up against a lot of that structure that biggerd banks haveto have," he said. With the FC Holdingx network, Harrison aims to build a networki of sister banks with six to 10locations each. With anotherd $75 million available to FC Holdings has grown It had 24 branchew statewide and a dozen aroundc the greater Houston area at the endof 2007. In additionm to lining up six branch locationsin Dallas, the grouo has hired a half-dozen lenders to drum up business in the says Frank Brinegar, First Community Bank's Dallas Brinegar and his bankers will targeg the owner-run companies like most other community bankw do.
That segment, he said, hasn'tg been affected by macroeconomic uncertainties. "We think the market is stillo very strongin Texas."