Old faces, new roles
As private equity firms turn their attention to banks, they are seeking out retired chiefs and other senior executives with banking experience to lead their investments and run the banks they buy.
Besides their operational experience, these executives bring to the table a crucial quality that can sometimes make or break a group’s bid to take over a bank – street cred with U.S. banking regulators.
Credible management for the banks they oversee is one of the key concerns of regulators, who worry about the health of the industry and separation of banking and commerce. It becomes all the more crucial in the case of private equity groups that don’t already own banks and so have no recent track record for regulators to rely on.
John Kanas, a veteran of the banking industry and former head of North Fork Bank, made such a comeback with a successful bid for Florida’s BankUnited.
Kanas leads the management team for BankUnited, which was bought by a consortium of private equity investors including WL Ross, Carlyle and Blackstone. He was tapped early last year by Ross to explore just such a possibility.
In another deal expected to be announced Thursday, Fortress Investment, Crestview Partners and Lightyear Capital plan to install Gene Taylor, a former Bank of America executive, as CEO after injecting $800 million into Florida’s First Southern, according to the Financial Times.
As the banking landscape is redrawn, it wouldn’t be a surprise then if other old faces end up in new roles before this crisis is over.