New York-based Flagstar Bank, which has its regional headquarters in Troy and operates 114 branches throughout Michigan, has expanded its private banking business by adding six private client banking teams from the former First Republic Bank in San Francisco.
In early May, JPMorgan Chase finalized a deal with the Federal Deposit Insurance Corp. (FDIC) to buy First Republic Bank.
The FDIC had seized control of the bank, which failed earlier this year due to a high volume of uninsured deposits, financial outcomes caused by rising interest rates, and other factors, and auctioned it off. JPMorgan won that auction and paid $10.6 billion for the bank.
“We are extremely pleased to welcome these new private banking teams to the organization,” says Thomas R. Cangemi, president and CEO of Flagstar Bank. “Flagstar Bank, N.A. is creating a first of its kind Commercial and Private Banking division dedicated to delivering best-in-class service to a loyal client base consisting primarily of high-net-worth individuals and their businesses.
“These six teams are regarded as among some of the best in the industry. The fact that they opted to join Flagstar Bank, N.A. is a testament to our business model and strong reputation in the marketplace. At First Republic, these teams attracted both deposits, especially non-interest-bearing deposits, as well as loans, and we look forward to their clients banking with our company.”
Three of the teams are based on the West Coast and three teams are based in New York City. The additions bring the total number of private client banking teams to 127, including 92 in the Northeast and 35 on the West Coast, with offices in more than 10 cities across the country including Troy.
“These new teams blend perfectly with our legacy private client teams,” says Eric Howell, senior executive vice president and president of commercial and private banking at Flagstar. “We both have a shared culture of providing personalized products and services via a high-touch, single-point-of-contact model, and meeting clients’ every financial need. We expect these teams to benefit the Bank from the onset.”
The following six private client teams have joined Flagstar Bank:
Jason Birnbaum, Gary Farro, and Alex Bolton have joined as executive vice presidents and managing group directors, after having worked together at First Republic Bank for many years and will lead a group of 16 teammates. The team is based in both midtown Manhattan as well as Boston and focused on meeting the needs of a wide array of clients, including high net worth individuals, private equity firms, and other professional service firms.
Douglas McNulty has joined as senior vice president and group director and also is based in midtown Manhattan and leads a group of three teammates who have worked together for two decades.
Basant Kedia has joined as executive vice president and managing group director leading a team in the Silicon Valley region.
Michael Manneh has joined as executive vice president and managing group director leading a team also located in the Silicon Valley region.
Kenneth Kearns has joined as executive vice president and managing group director in the San Francisco’s East Bay area, where he is leading a team of 16 bankers focusing on high net worth individuals, including executives and business managers for professional athletes, as well as high-end realtors, developers and builders, and professional services firms and their principals.
Erin Fitzsimmons has joined as managing group director and senior vice president of the Professional Loan Group. Based in Flagstar’s New York City office, Fitsimmons and her team of 13 bankers will develop specialized lending solutions for professional service firms and their employees in order to meet co-investment and/or capital needs.
In March, Flagstar Bank acquired certain assets and assumed certain liabilities of New York-based Signature Bridge Bank from the FDIC.
Under terms of the agreement with the FDIC, the bank:
- Purchased assets of approximately $38 billion, including cash totaling approximately $25 billion and approximately $13 billion in loans. Included in the $25 billion of cash is $2.7 billion arising from a discounted bid to net asset value.
- Assumed liabilities approximating $36 billion, including deposits of approximately $34 billion and other liabilities of approximately $2 billion.
The company says it is working on an agreement to sub-service the legacy Signature multi-family, commercial real estate, and other loans it did not acquire.
Also included in the transaction is Signature’s wealth-management and broker-dealer business.
The deal includes all of legacy Signature’s core bank deposit relationships, including both the New York and the West Coast Private Client teams, as well as the wealth management and broker-dealer business. The private client teams account for the majority of deposits assumed.
Flagstar says it plans to use its significant liquidity position to pay down a substantial amount of its wholesale borrowings, leaving the balance sheet in an even stronger cash position.
The purchased loans consist exclusively of commercial and industrial loans. The company did not acquire any digital asset banking or crypto-related assets or deposits, nor did it acquire loans or deposits related to the fund banking business.
The FDIC confirmed the agreement does not include about $4 billion linked to Signature’s crypto business, which the FDIC said it will deal with directly.
In connection with the transaction, Flagstar will take over all of Signature’s 40 branches. This includes 30 branches in the New York City metro area and several branches on the West Coast. Th branches will operate under the Flagstar Bank brand.
On the lending side, the bank added several new verticals, including middle market specialty finance, health care lending, and SBA lending, while adding to its existing verticals in mortgage warehouse lending, as well as traditional C&I lending.
