Latest New York de novo will court middle-market firms
New York has another new bank — just weeks after the last de novo debuted in the Big Apple.
“Basically, every product that we offer will be serviced out” the new branch, Wendy Cai-Lee, Piermont’s CEO, said in an interview.
“We occupied the entire third floor,” Cai-Lee added. “We’re really trying to be New York — we literally face Bryant Park and the New York Library. Our core value is to serve the New York market.”
Eight banks have opened this year, and seven other groups have submitted paperwork.
“I do not profess to know what the right number of banks in the U.S. is, but I recognize that, like many competitive industries, a dynamic banking sector needs new startups entering the marketplace,” FDIC Chairman Jelena McWilliams recently wrote in a BankThink opinion piece for American Banker.
The tricky part for many organizing groups has been capital. Organizers of Spirit Community Bank in Statesville, N.C., and Community Bank of the Carolinas in Winston-Salem, N.C., gave up, despite getting the green light from the FDIC, after failing to raise enough capital.
Community Bank of the Carolinas will instead look to buy an existing bank.
Still, a number of groups have succeeded.
Grasshopper Bank opened in New York in May. The bank, which raised more than $130 million in initial capital, will serve New York's innovation economy and venture capital firms. Grasshopper will also target companies and communities in other major innovation economy centers across the country.
Piermont’s opening also comes a week after Trustar Bank opened in Northern Virginia.
Cai-Lee, a former executive at East West Bancorp, said she believes Piermont will fill a void serving midsize companies. The plan is to target business that need to borrow $1 million to $12 million.
“Most of them are multigeneration, family-owned businesses,” Cai-Lee said.
“It’s the people that have graduated from a commercial real estate mold and now need the bank to structure the proper working capital … and cash management product, for them to continue to grow,” she added.
Piermont will initially have 24 employees.
“We look at [staffing] as a full, integrated team, which creates a special kind of efficiency,” Cai-Lee said.
While reliance on technology will also help Piermont remain efficient, Cai-Lee said the bank’s success really hinges on its employees.
A number of Piermont bankers and directors have ties to East West.
Robert Rynarzewski, who was a senior relationship manager at East West, is Piermont’s head of commercial real estate.
Julia Gouw, who retired as East West’s president and chief operating officer in 2016, is on the board, along with Charles Roff, a former director at MetroCorp Bancshares in Houston, which East West acquired in 2014.
Other bankers have ties to institutions such as Astoria Financial, Sterling National Bank, HSBC Bank and Greater Hudson Bank.
It is important to have “really good, experienced bankers,” Cai-Lee said.