Beverly Hills' bank to the stars wants to cast fruits and vegetables in supporting roles.
City National Bank last week said it plans to establish a unit to finance producers, suppliers, and distributors of farm products.
"As we look strategically at the future, we've looked at the growing businesses in California - and one of them is obviously agriculture," a $20 billion-a-year industry in the state, said George H. Benter Jr., president and chief operating officer.
Mr. Benter said he hopes about 10% of the bank's loans will eventually be to agricultural concerns. Agribusiness is newest niche for the $3.8 billion-asset bank, which has a well-known entertainment focus as well as interests in media and real estate, Mr. Benter said.
"People are not going to start calling us 'bankers to farmers,'" he predicted. "I think it's going to part of a well-diversified base of business."
The bank, now the largest based in Southern California, has a portfolio of about 44% commercial loans, 28% residential mortgage loans, and 23% commercial real estate loans.
About 11% of the bank's loans are to entertainment businesses, he said.
Debbie Jett Kessel, a farm lending specialist and veteran of 27 years at First Interstate Bancorp, will lead City National's charge into the Southern California agribusiness market, which includes fruit and vegetable producers and related businesses.
"We plan on focusing on ... people in this industry from the grower level right through to the wholesaler, as well as those people who service those industries," said Ms. Kessel, who has begun meeting with former First Interstate and other potential agribusiness borrowers.
To staff the agribusiness department, City National hired four former members of First Interstate's agribusiness unit, who were "displaced" after the regional bank's merger with Wells Fargo & Co. in April, Ms. Kessel said.
Mr. Benter said City National was interested in targeting agribusiness, but lacked experienced staff. Then Ms. Kessel's team, with its a track record, became available.
"We would never have done it without people that we knew understood the business," he said.
Similarly, Ms. Kessel said the agribusiness concentration fits well with City National's reputation as a relationship bank, even though it would be a new niche for the bank.
