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Irvine’s CalFirst Sold

Irvine-based California First National Bank, a once troubled online bank also known as CalFirst, was acquired by DMG Bancshares Inc., it was announced today.  

DMG’s investor group is anchored by Stone Point Capital LLC and Reverence Capital Partners LLC, with roughly 45% of the approximately $170 million in formal capital commitments. Stone Point is also involved in a proxy battle to acquire Irvine-based CoreLogic Inc. (NYSE: CLGC).

CalFirst ranked No. 13 on the Business Journal’s annual list of OC -based banks, reporting assets of $122.7 million as of June 30, down 26% from the prior year. It has one branch with 18 employees.

Its assets reached as high as $851 million in 2016 when it had 95 employees. The bank ran into trouble in 2017 when the Office of the Comptroller of the Currency advised it to cease originating leveraged and nonleveraged syndicated commercial loans and to take action to substantially reduce its concentration of leveraged loans.

The deal is the fourth banking venture on the West Coast by DMG Chair and Chief Executive Don Griffith. His most recent venture, Grandpoint Bank, acquired 11 banks from 2010 to 2014 and grew into a $3 billion asset franchise in Arizona, California and Washington before being acquired in 2018 by Pacific Premier Bank, now the largest bank headquartered in Orange County (Nasdaq: PPBI)  

“DMG intends to build a West Coast regional community bank through organic growth and acquisitions,” said a statement from the company. “The bank will focus on relationship banking for entrepreneurs, developers, builders, and investors in each of its local markets. A key focus will be on private lenders, real estate developers and investors in sub institutional multi-family, commercial and residential loans.”

DMG’s management will be Grandpoint alumni, Deborah Marsten, President and COO, David Dayton, CFO, Susan Wahba, Chief Risk Officer, Jim Hackbarth, Chief Credit Officer, and Loraine White, Director of Human Resources.

DMG was represented by legal counsel from Skadden, Arps, Slate, Meagher & Flom LLP and Duane Morris LLP, and applied with the Federal Reserve and OCC in November and was approved in December and January, respectively. Keefe, Bruyette & Woods, A Stifel Company, provided advisory services to DMG.

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Peter J. Brennan
Peter J. Brennan
Peter J. Brennan has been a journalist for 40 years. He spent a decade in Latin America covering wars, narcotic traffickers, earthquakes, and business. His resume includes 15 years at Bloomberg News where his headlines and articles sometimes moved the market caps of companies he covered by hundreds of millions of dollars. His articles have been published worldwide, including the New York Times and the Washington Post; he's appeared on CNN, CBC, BBC, and Bloomberg TV. He was awarded a Kiplinger Fellowship at The Ohio State University.
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