Memorial City Bank is canvassing its hometown of Houston for acquisition targets, capital and commercial loans.

Memorial City will open its second loan production office in Houston next month, says Allen Gage, the four-year-old bank's chairman, president and chief executive. MC Bancshares, the bank's parent company, has also filed paperwork for a $14 million stock offering.

The offering will help boost capital levels and fund the bank's growth in Houston, Gage said. The $206 million-asset bank grew 22% last year and has remained profitable since 2010.

Most young banks are restricted by regulators in making acquisitions until they're seasoned, but Gage is not worried. "With our asset quality, capital and management, they'd be hard-pressed to turn us down," says Gage, who has several unnamed banks that he would like to buy. "We feel like that sooner or later, and probably sooner, some of these community banks are going to have boardroom fatigue."

The new production office will be located in northwest Houston. Memorial City targets commercial and industrial loans ranging from $250,000 to $4 million.

Houston is quickly becoming one of the largest commercial loan growth markets in the country. Banks there are also severely competitive with pricing, but Gage says his bank has been able to get a safe footing by offering only adjustable-rate loans. They also hire loan officers familiar with that market.

"We've generated so far $12 million in loans and $8 million in deposits in that market" since the new lenders joined two months ago, Gage says. The loans "are impeccable. . . . Our philosophy is if a loan can't walk through the door, we won't make it."

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