Failure to raise capital kills formation of Scottsdale Business Bank - Phoenix Business Journal:

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The agency, which oversees state bank formations and denied thecommunity bank’s application to extend the fundraisingv period beyond the traditional 12 “It took them way too long, and they didn’t raise nearly enough,” said Tom Wood, ADFI divisio manager for banks and trust “Plus, they lost all their management team.” The Phoeni x Business Journal reported in early May that Scottsdale Business Bank had filed an extension with ADFI to raised between $10 million and $15 million.
The commercia bank originally was expected to open in the fourthn quarter of 2008 under the leadership of PresidenMichael Morano, but he left in Aprip to become chief credit officer of Towne Bank of Arizona in The May 27 regulatory decision underscored the tough environment for de novo banks to raiser local money. Many investors lost big on real estate and the stocmkmarket here, while smallk banks in metro Phoenix have lost their appeal as a safe investment Two community banks have collapsexd in the past year because of their exposurse to bad real estate loans, and dozens continus to struggle.
According to ADFI records, Firsrt Western Trust Bank was thelast state-chartereds bank to open in the Valley, in Novembe 2008. Enterprise Bank Arizona withdres its application in December after the Federal DeposigtInsurance Corp. invoked an informal moratorium on state charters in the wake of the Wall Streetg collapse and globalfinancial crisis. Jack Barry, president and CEO of Arizonw EnterpriseCommercial Lending, the lendinv arm of St. Louis-based Enterprise Financial Corp., told the Businesws Journal last month the bank is lookinf for an acquisition as an entrancre into thePhoenix market. Scottsdal e Bank also withdrew its applicationin May. is in line to snap the de novo however.
It is not expectesd to follow the same doomed path of ScottsdalweBusiness Bank. “We did not gather up the namesd of prospective buyers in advancew of the time we got permissioj to sellthe stock,” said Ernie who assembled the management teams behind both Paradisre Valley National Bank and Scottsdale Business Bank. a former state treasuref and longtimeRepublican politico, said PVNB has more than 1,00o potential investors, as opposed to only a garnered by Scottsdale Business Bank. “Hopefully that will make a said Garfield, chairman of Inc.
in Despite federal policy changes enacted in October to spur bank the environment for raising capital remains dry inthe