Breaking the Bank

by francine Hardaway on May 1, 2008

I’ve been involved (and invested) in the formation of a new bank holding
company for a while now. It’s time for a new bank, because the existing
banks are up to their ears in bad loans and no one who needs a loan can
get one. The concept of the bank was interesting to me from the get-go,
because it is a holding company for a bank that will operate in four
states: California, Nevada, Arizona, and Texas. This regional concept is
one of the new ideas that attracted me. As an angel investor, I like to
have a portfolio, rather than a single investment. Four banks sounded
good. We have named the overall entity Ventana National Bank, and the
siblings Ventana Bank Arizona, Ventana Bank Nevada–you can figure it
out from there. Ventana means “window” in Spanish.

The California bank (in San Diego) is the furthest along, and we expect
our California Charter approval in the next three weeks, which will take
us to our public fundraising. Right now, we have our seed funding —
from nearly 100 founders and organizers of the three banks already in

By becoming a founder and accepting a board position on Ventana Bank of
Arizona (in formation)’s board, I have become able to influence the
direction this bank goes in — not only in Arizona, but to some extent
across the franchise. I thought I would never have this opportunity in
my life, so I’m totally stoked.

Here’s what I’m thinkin’, and what the bankers have so far agreed with.
These are activities that I hope will be part of the core fabric of the

On the community relations side:
1)Classes in financial literacy and consumer financial education
2)Workshops in entrepreneurship
3)strong commitment to minorities, diversity, and microlending
4)involvement by and for women
5)partnerships with schools to teach financial literacy

On the “real” (financial side):
1)strong commitment to entrepreneurship
2)strong commitment to smaller businesses
3)raising money to open the bank by allowing a broader base of smaller
4)having women and minorities as shareholders
5)having the people who invest in the bank be customers of the bank
6)creating a TRUE community

Most of the banks in formation that I’ve known about recently have been
backed by a small group of guys (just a word) who threw in their
personal capital to open the bank. That makes most new banks “private”
banks, often concentrating on concentrating to a speciice niche (in
Arizona often real estate). The units of investment are so big that
“ordinary” people can be shareholders in the bank. So when the bank is
sold to a bigger bank (this is the “exit” strategy most often), a small
number of people make money.

But my travels around the world have taught me that true community
lending can make lots of money and still be a service to a larger
community. We don’t really have an entrepreneur’s bank in Arizona right
now, or even a bank that understands the unique needs of small business.
I do.

Fortunately, banking is tightly regulated, so I can’t get too dreamy.
But stay tuned. If I don’t participate in the formation of a bank that
is trully different and inclusive, I’ll feel like a real failure.

{ 1 comment… read it below or add one }

Anonymous March 10, 2011 at 2:01 am

This is a very thorough assessment of what the public or those somewhat close could garner from the Banks application and newspaper stories. The Bank did not open and the organizers in three states spent $3.5 million to teach them selves “We do not know what we do not know yet”. Tom Hassey selected very poor Sr Management candidates, non qualified members for the Board of Directors, and covered for his buddy Ed Brand. This is a lesson in how not to execute a poor plan even if the concept is great. bankalchemist.

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