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City National On Hunt for Executives

City National Bank wants bankers, wealth managers and other financial executives in Orange County to know one thing.

“We are looking, in big, bold letters,” Chairman and Chief Executive Russell Goldsmith said in an interview at the Business Journal. “We’d like to hire more bankers, more wealth professionals.

“We have tremendous room to grow in Orange County.”

Since City National was acquired in late 2015 by Royal Bank of Canada (NYSE: RY), the Los Angeles-based bank has expanded assets by a third to almost $50 billion, about five times the size of the biggest bank based in Orange County.

Goldsmith’s comments are another indication of increasing bank activity in the county, where two banks are opening this year. Morgan McGrath, JPMorgan Chase & Co.’s head of international banking, told the Business Journal in March that OC is “increasingly important” to the bank and that “we’re excited about what’s ahead.”

Goldsmith’s remarks also underscore a fierce ongoing battle among banks to recruit executives. Irvine-based Opus Bank said in April that it settled a lawsuit against rival First Foundation Inc. for allegedly stealing nine executives.

This year, Opus announced it hired two senior executives from City National. When asked whether City National might reciprocate, Goldsmith replied, “So far, we haven’t found anyone at Opus that we want to hire.”

More Exposure Sought

City National was launched in 1954 by a group of friends, including Goldsmith’s grandfather. Goldsmith became chief executive in 1995 when the bank had $3 billion in assets and 1,300 employees.

RBC’s acquisition has enabled the bank to expand capabilities, a fact Goldsmith said isn’t as well-known in Orange County as he’d like it to be.

“We can do anything for clients that the biggest banks in the world can do, and yet we’re very local,” said Bob Iritani, City National’s top executive in Orange County, as he sat next to Goldsmith during the interview.

Ed Carpenter, founder of a well-known banking advisory firm that’s opening the two OC banks this year, recently told the Business Journal that Orange County lacks competition in banking.

“I’m stunned that he would say that,” Goldsmith said. “I don’t agree with that. It’s very competitive. Believe me. If there was a lack of competition, we’d have 80% market share. Everybody’s here. Small banks, medium-size banks, big banks.”

Say No to Hollywood

The county has strengths in a variety of industries, like real estate, pharmaceuticals and technology, he said.

One area where he sees no potential for Orange County is film and TV production. City National is known for its Hollywood connections, and Goldsmith often sees the deals up close. He was chief executive of Republic Pictures Corp. from 1986 to 1994, winning Emmys for a miniseries on a school desegregation court case.

He said Orange County would struggle to attract media production due to costs, union rules and other factors, including lack of “critical mass.”

“It’s a tough challenge for Orange County to overcome,” he said. “Trying to twist yourself into a pretzel to get three movies here annually is glamorous but is not really productive.”

Wide Range

Goldsmith is also chairman of RBC Wealth Management, which has $413 billion in client assets.

He said there are “good investment opportunities in a range of areas” and recommended working with professionals rather than buying indexes.

Since RBC’s acquisition, City National’s headcount has climbed a third to 4,500. Its OC headcount has kept pace, increasing 32% since 2014 to 153.

The bank may add an office to its OC count of six, Goldsmith said, adding that branches nowadays are like “mausoleums,” since so much business is done online.

Overall, “the economy is quite strong,” and he said business is good for his clients and the bank.

The recently enacted federal tax cut has enabled City National to increase its profit-sharing plan and 401(k) retirement plan matches.

In Orange County, the bank experienced “good, double-digit growth” in lending across business platforms in the first quarter, Iritani said.

“We’re looking for the very best talent,” Goldsmith said. “If we can find more top-rated bankers, wealth managers, whatever it is, we have an open-to-buy for superior talent. “I look to see us hire more people. That’s the key in Orange County.”

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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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