First PacTrust's plan to have power sharing between two chief executives was short-lived.
The $1.6 billion-asset company said late Friday that Gregory Mitchell, who had been its CEO since November 2010, had resigned. The resignation comes roughly a month after First PacTrust announced that Mitchell would share the CEO title with Steven A. Sugarman, a financier who led a recapitalization of the Irvine, Calif., company two years ago.
First PacTrust (BANC), a former credit union that converted to a savings bank, said on Friday that Sugarman would become its sole CEO. The company also said that Robert M. Franko had become the chief executive of its Pacific Trust Bank. Franko was already the company's president and the chief executive of Beach Business Bank, a $311 million-asset bank that First PacTrust bought in July.
Franko will be in charge of an effort to merge Pacific Trust Bank and Beach Business Bank, a move designed to realize "numerous financial and strategic synergies," Timothy R. Chrisman, the company's chairman, said in a press release.
Mitchell will serve as a consultant to the company for up to six months, the release said. "As a result of the company's strong current position, it became clear to me that this was the perfect time for me to step away and pursue personal goals," Mitchell said in a press release.
Efforts to reach First PacTrust and Mitchell for further comment were unsuccessful.
The move surprised Joe Gladue, an analyst at B. Riley, though he said in an interview that he thought the co-CEO plan was a strange move that was unlikely to last over the long term. "Certainly, an arrangement like that is not very common … although I had no preconceived notions as to how long it would actually last," he said. "I can't say I thought of it as a sign of Greg resigning."
Gladue said First PacTrust held an analyst day shortly after it completed the Beach Business Bank acquisition. Gladue said he realized at that event that Franko would become a major player in the company's future, though he did not witness any acrimony. "I detected no signs of ill will," he said.