Veteran, retired regulators and bankers arise to assemble new banks from those fallen
Wake up and good morning. It's Blast from the Past time in Florida banking, as former financial regulators and ex-Tampa Bay bankers resurface on the hunt, armed with government subsidies, to buy and run crippled banks, fix them up and (eventually) sell them at great profit. There are plenty of troubled banks to choose from and more on the way in Florida, as this St. Petersburg Times story attests.
One group called BSE Management Groupseeks to build a $2 billion war chest to allow "it to be highly selective" in buying failed banks, according to an offering sheet obtained by a banking industry publication.
If you've been in Tampa Bay long enough you may recognize this former area banker, George Koehn, who ran the SunTrust regional banking operation here before heading to Orlando. He retired from SunTrust in 2005 but then joined the Holland & Knightlaw firm as a "senior adviser." Koehn was also a mover and shaker while in the Tampa Bay market, just as SunTrust's current area bank chief, Dan Mahurin, is deeply involved.
Now comes a report in the American Banker, the daily newspaper that covers the banking industry, that Koehn has teamed up with a group of ex-bankers and former federal bank regulators. Once this group assembles a new bank from the collection of failed institutions currently being peddled by the feds, Koehn will run it, the newspaper says.
And who leads BSE Management? Bill Isaac, a part-time resident of Sarasota who served as chairman of the Federal Deposit Insurance Corp. in the 1980s when savings and loan and bank failures were much more rampant than even today. Isaac went on to form a bank consulting business called the Secura Group which was bought in 2007 and is now known as LECG GLobal Financial. Here's more from Bloomberg on Isaac's group, BSE -- not to be confused with the Botswana Stock Exchange.
Also participating in BSE are Robert Helms, a former Wachovia executive in charge of its Florida banking operations. He will serve on the bank's board.
I covered banking in Washington, D.C. during the brisk Isaac years at the FDIC -- back when Ronald Reagan was president and Paul Volcker chaired the Federal Reserve. You think the current debate over Too Big To Fail (TBTF) is new? No way. They were wrestling with it even then when big banks like Continental Illinois was collapsing and regulators were nervous what systemic damage a failed bank of that size could cause. Well, they never came up with a good answer to the TBTF dilemma, which is one reason we wrestle with the same matter today.
-- Robert Trigaux, Times Business Columnist