Endeavor Bank in San Diego is set to become the second de novo to open in California in the past year.
The bank, which raised nearly $27 million from more than 450 investors, will open on Jan. 22. Raising the capital was the final hurdle for CEO Dan Yates and the bank's other founders.
“The response from the local community has been overwhelming," Yates said. "Word of mouth spread like wildfire. Our phones started ringing and never stopped.”
Shareholders invested anywhere from $25,000 up to $1 million. While seeking capital in smaller increments added a level of difficulty, having a large base of supporters, with most being local business owners, gives Endeavor a lot of options for bringing in business, Yates said.
“I guess you can always raise money from a handful of high-net-worth individuals who put up $500,000 or $1 million each, but when I look at our investors and think who they’re connected to — we succeeded well beyond my greatest expectations,” Yates said.
Endeavor actually brought in 8% more capital than it needed.
Winter Park Bank in Winter Park, Fla., which opened in August, raised 33% more than the $30 million it originally sought.
Endeavor, which will focus on small businesses around San Diego, will have a downtown branch and a loan production office in Carlsbad, Calif.
Endeavor’s opening nearly coincides with the first anniversary at Blue Gate Bank in Costa Mesa, Calif., which became the state’s first new bank since 2010. In its first nine months, Blue Gate nearly tripled in size to $116 million in assets, according to the Federal Deposit Insurance Corp.
With nearly a dozen groups looking to form banks, 2018 is shaping up to be the busiest year for new bank formations since the financial crisis.
“It’s always good when capital is coming into the industry,” said Tom O’Brien, the CEO of Sun National Bancorp in Mount Laurel, N.J. “I think de novo banks starting in different markets is a healthy sign, and San Diego is a market that has seen some consolidation.”