Union Bank has worked overtime endearing itself to Marin as it cleans up the scraps from Tamalpais Bank, which died in April. An autopsy of the failed bank showed the lender succumbed to an overdose of commercial real estate loans. The Feds put the bank on notice last September that it needed to get into rehab, clean up its troubled debt and raise capital. It tried to go straight, selling off some bad debt and hunting for new investors. But, in the end, the jones for real estate proved too powerful. The state of California stepped in and shut Tamalpais down, turning the keys over to the Feds as the receiver, who then brought in Union Bank.
Many in the community were worried that Union Bank, headquartered in San Francisco, might not be willing to take up the mantle that Tamalpais had worn for many years. Tam consistently donated to local nonprofits, sponsoring the high profile Heart of Marin event and working behind the scenes to aid the community.
Union Bank has already announced it will continue supporting Heart of Marin. While it’s nice that Union will write some checks, the jury is still out as to just how supportive the regional player will be. UnionbanCal Corp had $86 billion in assets as of the end of 2009. It’s a wholly owned subsidiary of the Bank of Toyko-Mitsubishi UFJ Ltd., which, in turn, is a subsidiary of Mitsubishi UFJ Financial Group Inc. Union Bank is a lot closer to Wells Fargo or Bank of America than it is to Bank of Marin or Circle Bank.
Both Wells Fargo and Bank of America try to support the communities they’re in, and often do so by writing a check. With Tamalpais, when a nonprofit had a problem, it could call the bank and talk to somebody who knew what it did and possibly find help that would make a difference. Time will tell if Union does something more than keep the branches open and take deposits out of the community. On the business side, it’s opened a $60 million line of credit for Marin General Hospital as the health care provider weans itself from Sutter Health in a split worthy of any Hollywood divorce.
Still in the local world of banking, Circle Bank of Novato opened a branch in San Francisco’s Noe Valley and has found the new neighborhood quite welcoming. In the 10 days after it opened, Circle took in $1 million in deposits. For an institution with just $280 million in assets, this is no small thing. With the shuttering of Tamalpais and Union’s takeover, the local bank market in Marin County just changed, with Union being a bigger bank while Circle and Bank of Marin are beating the community bank drum loudly.
Mill Valley’s Redwood Trust back in the game
Redwood Trust, a real estate investment trust that specializes in investing in securities tied to mortgages, has put a $222 million package of residential-backed mortgage securities into the market in a move that could mark the reopening of the long-dormant market. When the housing market imploded like a BP oil rig, lenders tightened loan standards and bond investors stopped buying securities tied to residential mortgages. Aside from mortgages sold to Freddie Mac and Fannie Mae, the market doesn’t exist as investors have showed an unwillingness to consider securities not backed by the government. But Redwood Trust’s marketing of securities tied to jumbo mortgages originated by Citibank may break the ice.
Both Fannie and Freddie are banned from originating or buying jumbo mortgages, the size that’s typically found in expensive housing markets like Marin and much of the North Bay. If Redwood is successful in selling the so-called private-label, residential-backed mortgage securities, credit markets may ease and home buyers could find lenders willing to make more loans at lower interest rates. Resurgence in the housing market has the potential for adding fuel to a recovery and adding jobs.
In a separate development, CEO George Bull has stepped down from that position. He’ll continue as chairman of the board.
Larkspur Hotels opens Mill Valley location
In a former life, it was a Howard Johnson’s and a Holiday Inn Express. But now, it’s the Larkspur Hotel Mill Valley, fresh off a $3 million remodel. It’s the second Marin location for the Larkspur-based Larkspur Hotel and Restaurant Group. The company, led by CEO Karl Hoagland, has 23 hotels located in Washington, Oregon and California, spread across three distinct brands. The other Marin property is the Lodge at Tiburon.
Besides buying properties and expanding its brand penetrations, the company was recently ranked as the Number 1 place to work by San Francisco Business Times for companies with between 500 and 1,500 employees. It’s the second year running that Larkspur walked with the hardware.
ClairMail says buh-bye to Hamilton
Mobile banking company ClairMail is taking about 14,000 square feet at San Rafael Corporate Center, walking away from its expired lease at Hamilton Landing. For Hamilton Landing, it’s the second big fish to get away, as Disney affiliate Image Movers Digital announced it will be gone by January 2011.
ClairMail has about 130 employees who live in the East Bay, so the San Rafael location is an easier commute for them. But ClairMail, which caters to companies looking for customer-based mobile payment solutions, is also looking to impress conservative bankers. CEO Peter Daffern said banks need to see ClairMail as a viable company, in it for the long haul, and the Corporate Center sends that message.
Reading between the lines, it appears Daffern wants to trade ClairMail’s identity from hip high-tech to staid corporate stalwart. You can almost hear Marin’s own Huey Lewis and the News over the Muzak in the lobby singing “Hip to Be Square.”
