The long-troubled Bank of San Francisco Co. is trading in its stock and its name in a bid to reinvent itself and raise $17 million.
In an effort to become a "strong, resilient" force for private banking for Pacific Rim clients, Bank of San Francisco Co. is dropping the word "bank" from its name and simply calling itself San Francisco Co.
It's subsidiary bank, Bank of San Francisco, will retain its name. Chief executive Kent D. Price hopes the move, coupled with a cadre of high-priced bankers, will begin to make up for two years of losses totaling $30 million.
The $215 million bank has had to be recapitalized twice during that period by its main stockholder.
Reverse Stock Split
The bank is under orders from federal and state regulators to raise capital. The company said last week it intended to raise at least $16.9 million in a private offering by the end of June.
To facilitate the offering of stock, which will be at a significant discount to book value, the company is performing a 1-for-20 share reverse stock split in its Class A common stock, the key component of the upcoming offering.
The company also is converting two of its other classes of stock into Class A common, resulting in about 2.2 million shares of Class A common.
It hopes to offer securities made up of the Class A to overseas investors. Other private banks in San Francisco, however, have had little success garnering an international stockholder base. Bank of San Francisco Co., in fact, is the only such institution with a foreign majority stockholder; Putra Masagung is Indonesian.
One San Francisco analyst, who called Bank of San Francisco a "black hole" because it has lost so much money in the last three years, was surprised that the company would be so outwardly confident.
Mr. Price was hired last year to turn the bank around, but it has continued to lose money. It lost $3.2 million in the first quarter, compared to a loss of $2.6 million a year earlier.