The founders of the midstate’s newest planned bank kicked off a capital campaign Wednesday.
Their goal: Raise at least $20 million so they can buy an existing bank and make it their own.
Banking veterans George Groves, founder of The Legacy Bank, and Percival Moser III, former COO of Metro Bank, announced their intention to start a new bank in November. The venture will be called Advantage Bank – a name, they said, that gives them ample flexibility in how they market themselves.
Their plan is to purchase a bank already insured by the Federal Deposit Insurance Corp., thereby bypassing the strict regulations and other challenges that come with starting a bank from scratch. They then hope to take over management of that bank and grow it from there.
The capital campaign is set to end June 30, but the bank’s leaders have the option to cut it short or extend it. They are offering stock warrants to all initial investors, not just its directors – a move, they said, that is not terribly common in the banking industry but will hopefully help them attract more supporters.
Advantage’s founders have spent the past several months preparing for the capital campaign and meeting with prospective acquisition targets. They are looking for a bank within about 100 miles of Harrisburg, with between $75 million and $300 million in assets and leaders looking to leave the field or partner with the Advantage team.
A sixth director, Journal Multimedia founder and former CEO David Schankweiler, joined the bank’s board since the founder’s initial announcement. The rest of the board includes Groves, who will also be Advantage’s president and CEO; Moser, the board’s chairman; and other Pennsylvania business and banking leaders.
Groves and Moser believe their collective experience will make them an attractive partner to potential acquisitions, as well as effective leaders of the kind of bank they feel is needed in the midstate in the aftermath of recent market disruptions.
When larger institutions like BB&T and F.N.B. Corp. absorbed some of the region’s smaller banks, they left a void for banks taking small to medium-sized business loans, they believe, as well as a dearth of experienced bankers to handle those loans.
Advantage Bank plans to primarily serve business customers who need loans between $500,000 and $1 million, specifically targeting businesses like independent physicians, dentists, veterinarians and other industries with high credit ratings.
The bank will operate with a small physical presence, starting with branches near Lancaster, Harrisburg and wherever necessitated by the institution they purchase at the onset. The founders suspect many customers will opt to do much of their business online.
After the end of the capital campaign, the bank’s leaders hope to close in on their first acquisition in the second quarter of this year. More acquisitions could follow in the second half of 2017 and early 2018.