The Nu-World of Bank Capitalization
NEW YORK, Sept. 30 /PRNewswire/ -- The collapse of the financial sector in the United States, which has included the failure of almost 100 institutions to date, actually started in 2007 and became dramatically clear in the latter half of 2008 though it still persists well into 2009. This cataclysmic event ushered in a new era for the world of Community Bank Capitalization.
Gone is the "Good Old Boy" networking on Wall Street that ruled this arena for the past decade. However, the dozen or so leading investment banking firms who are still in place seem to be oblivious to the transformation and continue their old ways. They are still on the prowl for bank clients luring them with tales of easy stock placement within their network of institutional and private investor pools. They are still hitting up the new clients for well into six figures for "fee base" compensation BEFORE they raise a nickel. If the funds are not raised as promised this "fee" is forfeit by the bank.
Why is this old system of Capital Acquisition not succeeding in the current milieu? In addition to the uneconomical front loaded fee system in place, the fact of the matter is that the usual potential investor groups the Wall Street firms approach are not capable of providing funds as they did in the past! Private and Institutional investors alike have lost, in many cases, in excess of 40% from previous portfolio levels. It follows that not only are the funds available for new commitments much less than in previous times, but the appetite to deploy additional funds is lacking. It is time for a change.
Many believe that there is no capital out there; that new and existing banks trying to raise capital are fighting a losing battle. But NuBank believes otherwise. Today their 146th bank opens in Norman, Oklahoma after a successful capital campaign. Did the money flow in when the campaign started? No. But with perseverance and a formula that capitalized the bank with money from the bank's market Great Nations Bank raised what they needed and opened their doors, proving that capital is out there.
NuBank is a professional association providing expertise in each stage of a Bank's development. The firm has over the past quarter of a century assimilated a cadre of professionals to assist client banks and established relationships with bank investors who are savvy and not of the cookie cutter base permeating the status quo. NuBank realizes that this is an unprecedented opportunity for investors to establish positions in excellent banks at advantaged pricing. As a result NuBank focuses on matching client banks with not only the Capital required, but in the process aligns them with investors who are in sync with the Banks' business plan and corporate culture.
An additional unique marker for NuBank is the development of a new Capital for Assets program. In conjunction with this program, which being used to help existing banks obtain capital while simultaneously cleaning up the balance sheet, is the implementation of a professionally prepared Opinion of Value by James R. Miller, a nationally recognized analyst and appraiser of banks for eBankstocks. NuBank is the only firm in the county to offer this program.
It is the dawn of a new era in bank financing. NuBank is leading the charge to establishing the capital raise process as a make sense economically efficient endeavor.