De novos built for niche audiences
Albert Amini and the team working on Discovery Business Bancorp in Chandler, Ariz., see a need for a local bank to serve area entrepreneurs and small businesses.
While initial approval from the Arizona Department of Financial Institutions is required before organizers can start raising capital, the de novo effort already has a niche in mind. In addition to traditional banking services, Amini said he envisions Discovery offering educational resources to small-business owners.
Several other groups are also identifying specialization for their de novos. Another Arizona group hopes to open banks focused on military veterans. Moxy Bank, a proposed minority-owned bank in Washington, would focus on low- and moderate-income clients. And Grasshopper Bank in New York intends to serve the innovation economy.
Before the financial crisis, many de novos were built to bulk up and eventually sell, said Greyson Tuck, an investment banking adviser at Gerrish Smith Tuck. That model is changing, Tuck said. Becoming well known in a niche could be a way for new banks to add value and stand out in a competitive market, industry observers said.
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