There is nothing like the pending sale of a company to set off a stampede to hire away its best people.
That is what is happening to Money Store Inc., which last week agreed to be bought by First Union Corp. for $2.1 billion.
Because Money Store is the nation's No. 1 small-business lender, according to the Small Business Administration, banks are swooping in, trying to entice away some of the company's talent.
The phenomenon is particularly acute in California, where there are many small businesses seeking capital. Twenty-three percent of the $9.42 billion lent though the SBA's largest program last year, or about $2.2 billion, went to California business owners. California community banks typically rank among the top 25 SBA lenders nationwide.
As for Money Store, "we would certainly like to hire their people and we are actively trying to pursue them," said David Bartram, senior executive vice president and manager of SBA lending at San Diego-based Bank of Commerce.
The $470 million-asset bank has hired several recruiting firms to help woo Money Store employees, Mr. Bartram said.
Money Store, which is based in Union, N.J., but has its SBA lending offices in Sacramento, declined to comment on other lenders' efforts to attract its employees.
First Union spokeswoman Marianna Sheridan said that no Money Store employees would be laid off as a result of the merger and that the company is optimistic it would be able to keep valuable staff members.
Mr. Bartram said he has interviewed several Money Store employees, but has not hired any yet. Money Store would not confirm its total number of lending officers, but it has about 75 people making small-business loans across the country, according to Cal Cain, who left the company last month to join Regency Bank in Fresno, Calif.
Bank of Commerce is "trying to get the word out" that it is looking to hire Money Store employees, Mr. Bartram said.
He and other bankers in California are convinced that hiring from Money Store would boost loan originations.
"Getting the people that have the connections is the key to getting the deals," said Rodney D. Jones, president of North County Bancorp in Escondido, Calif.
According to Tim Thompson, a recruiter with Korn Ferry International, Money Store employees would be more likely to consider offers from competing lenders now because of the upcoming merger with First Union.
"When a company is going through a challenging time, that makes employees more receptive," Mr. Thompson said.
Robert Longatti, executive vice president and chief credit officer for $188 million-asset Regency Bank, said Mr. Cain had been eager to join the bank's 10-person SBA lending staff when he was offered a position last month.
"He was a good strong competitor for years," Mr. Longatti said. "There are not that many people in the market that have the sales skills and understand SBA lending."
Mr. Cain said he had heard talk about Money Store's volatile future before he switched jobs. The Fresno bank didn't increase his base salary much, but offered a more attractive commission structure, he said.
"There was some degree of uncertainty when I left," he added.
Another employee who recently left Money Store has a job interview scheduled at $385 million-asset Cupertino National Bank and Trust, according to Ralph W. Barnett, the bank's vice president and manager of SBA lending.
"Any time an organization goes through some major changes like that, it's a good time to look for quality people," Mr. Barnett said. "The Money Store does a good job training them."
Other California bankers said they are not specifically recruiting Money Store employees but would not mind interviewing them for open positions.
"When there is a change in control in a company that big, you pay attention," said David Broadley, chief financial officer and manager of SBA lending for $449 million-asset SierraWest Bancorp in Truckee, Calif. "We have a great deal of respect for them."
California lenders acknowledged that there are some differences between working at Money Store and a bank. Money Store people tend to have specialized skills in either marketing, underwriting, or workouts, while bank employees tend to be generalists, they said. Money Store also requires smaller down payments on commercial real estate loans than banks.
Despite the differences, bankers such as Gary Youmans, manager of SBA lending for Fallsbrook National Bank, said he would love to hire some Money Store employees. Fallsbrook National plans to open new SBA lending offices in Fresno and Sacramento, he said.
"If those people become available, I would love to talk to them," Mr. Youmans said "They did not get to be the No. 1 lender by doing things second-rate."