Scottsdale community bank in formation hires former JPMorgan exec as CEO22-Apr-2020
A community bank that is forming in Scottsdale has hired its first president and CEO.
Gainey Business Bancorp Inc. — which received approval in the summer of 2018 from the Arizona Department of Financial Institutions to be "in organization" — has hired a longtime banker who had executive leadership roles with JPMorgan Chase and Bankers Trust.
Joseph Stewart, the new president and CEO, has more than 30 years of banking experiencing in the Phoenix market, including 13 years in executive leadership roles with JPMorgan Chase and Bankers Trust.
When "in organization," the bank's board can raise capital by selling shares as it moves toward approval to file a charter application with federal and state authorities. It can do this without being required to have a president or office lease in place.
But having key leadership in place is essential for raising money, said James Unruh, chairman of Gainey Business Bancorp's board and the founding and managing principal of Alerion Capital Group LLC, a private equity and management advisory firm.
That's why it was essential to get the president and CEO in place, along with other key management positions, he said.
Unruh said the goal is to raise between $15 million and $20 million over the next several months. "Our target is to open the bank in the late fourth quarter or first quarter," he said.
While fundraising has been on hold during the search for a CEO, Unruh said he plans to open fundraising within the next 10 days.
Unruh replaced Ed Johnson as chairman of the board after Johnson left that position to devote more time to his own business, University Growth Solutions, and transition to the bank's advisory board.
Looking for office space
Unruh said he's looking for office space in the Gainey Ranch area toward the Scottsdale Airpark.
Stewart said he enjoyed his time with the big banks but looks forward to being more directly involved with clients. He said he wishes he had the capital in place today to open the bank to provide funding for small businesses hurting from Covid-19.
But with only four community banks in Arizona, there's a need for smaller banks to focus on small and mid-sized businesses, he said.
Even so, he said, small businesses still will need access to a community bank when Gainey Business Bancorp opens later this year.
"We're not completely going to specialize in any one niche," Stewart said. "We want to be available for clients across a wide spectrum. We would envision hiring an SBA banker and we would envision looking at Hispanic-owned businesses and the health care sector on the smaller revenue side."
Rich Vogel, an advisory board member, said community banks are more nimble than the larger banks and can make quick local decisions.
With 98% of businesses in Arizona represented by small firms, there's a lot of room for serving an unmet need, Vogel said.
"Ninety-eight percent of the market is not served well," he said.
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