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De Novo Banking: Advantages and Disadvantages of Using a Holding Company

Posted by Wendell Brock on Thu, Sep 11, 2008

Recently I added a new white paper to download from the De Novo Strategy website about the basics of using a holding company with a de novo bank.  Below is the introductory paragraph; the intent is to post helpful information for people interested in de novo banking.  As always, I wish you the best of success in your endeavors!

The de novo bank can be established with or without a bank holding company. While the existence of a one-bank or multi-bank holding company can greatly increase the flexibility of the de novo financial institution, this flexibility does come at a price. On the positive side, the holding company structure allows the bank to participate in non-traditional banking activities, i.e., business other than taking deposits and making commercial loans. For example, the institution may sell mutual funds, insurance, or underwrite specific securities. A holding company may also borrow money, through the issuance of bonds or other vehicles, and push that capital down to the bank; the bank then enjoys greater financial backing to support business expansion and leverage of its capabilities. Repayments of that borrowed capital are typically structured as dividends from the bank to the holding company.

To download your copy click the link: Bank Holding Company

Topics: De Novo Bank, Bank Holding Company, multi-bank holding company

Federal Reserve Announces Launch of National Minority-Owned Bank Program

Posted by Wendell Brock on Thu, Aug 07, 2008

The Federal Reserve System today announced the nationwide launch of Partnership for Progress, an innovative outreach and technical assistance program for minority-owned and de novo institutions.  The program seeks to help these institutions confront their unique challenges, cultivate safe and sound practices, and compete more effectively in today's marketplace through a combination of one-on-one guidance, workshops, and an extensive interactive web-based resource and information center (

"The program's overarching mission is to preserve and promote minority-owned institutions and to enhance their vital role in providing access to credit and financial services in communities that have been historically underserved," said Federal Reserve Board Chairman Ben S. Bernanke. "The Federal Reserve is committed to helping minority-owned and de novo banks achieve long-term success."

Partnership for Progress provides insight on key issues in three distinct stages of a bank's life cycle: "Start a Bank," "Manage Transition," and "Grow Shareholder Value." Topics covered include credit and interest rate risk, capital and liquidity, and banking regulations. To ensure broad access to the program, all aspects of the training will be available through workshops, online courses, and the program's interactive website.

"This cutting-edge program, which draws on insights from economics, accounting, finance, and regulatory compliance, will become a valuable resource for institutions at different stages of their development," said Federal Reserve Board Governor Randall S. Kroszner.

In developing the program, Federal Reserve officials met with minority-owned and de novo banks across the country as well as trade groups, bank consultants, and state and federal banking agencies to better understand the challenges these institutions face in raising capital, growing their institutions, and attracting talent. This process provided valuable insight and contributed significantly to the design of the program, which was spearheaded by the Federal Reserve Bank of Philadelphia. Key concepts from the program will be incorporated into the Federal Reserve System's examiner training to provide a deeper understanding of the issues unique to minority-owned institutions.

The nationwide launch of Partnership for Progress follows a successful pilot for the program that began last fall. Questions and comments regarding the program should be directed to Marilyn Wimp at the Federal Reserve Bank of Philadelphia, 215-574-4197.

Note:  While at the Minority Depository Institutions National Conference we received a preview to this program.  This will be a great help to all de novo and emerging banks.  Take a few minutes to view some of the information on the site.

Topics: Community Bank, Bank Regulators, Commercial Banks, De Novo Bank, Bank Capital, Minority Banks

Why Branding?

Posted by Wendell Brock on Wed, Mar 12, 2008

By John Fronza 

If you do not have a branding consultant, you are the consultant.

You need to spend your time on raising capital and producing revenue; not designing a logo, writing copy, formatting brochures, and placing ads, or any of the many details required for a successful branding campaign.

We can handle everything from helping you name your bank and design your logo to designing your website and public relations. In the grand scheme of things you will have more time, raise your capital faster, and earn more.

Why do you need a branding campaign? How is the investment justified?

Your logo and marketing materials will be seen and have an impact on not only your Officers, Directors, Executives, and employees, but on your customers, potential customers, competitors, and the general public.

They represent you and your organization - your products and services as well as your professionalism, integrity, and ethics.

The image you develop now will be used throughout the life of your business and determine your business's level of success. If your image is one of a solid, stable company that delivers what it promises, you are more likely to be successful.

What do you think of when you see this logo?

Nike, of course. An established, reliable company that has used the same logo for many years.

This is what you want to accomplish - a sound identity.

Branding is an investment with a high rate of return. What can you expect your return on investment (ROI) to be?

Let's say that you would typically expect to spend six months raising the capital for your bank without any marketing materials or branding. During these six months your bank is not producing any revenue, you are still waiting to open your doors to customers, and each month that passes costs you $50,000. It has been proven that with the right materials, branding, and a proven process the capital raising time is shortened by fifty-percent. So, you have already saved $150,000.

Moving forward, your bank will be instantly recognizable to customers and potential customers resulting in more deposits and faster growth. You stand out amongst all of the other community banks. Why? Because customers and the general public instantly recognize your professional image which is consistent in every way relating to your bank.

Fronza Design's successfully proven program for de novo banks is a small investment to expedite the capital raising process, brand your bank, and ensure success.

Let us show you how to save time, money, and help you achieve your goal.

If you are in search of a $10,000 investor, you need to look like a $10,000 opportunity.

Fronza Design, LLC
125 Timber Oak Cove
Lawrenceville, GA 30043

Topics: De Novo Bank, Marketing, Bank Branding

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BankNotes© is published by De Novo Strategy as a service to clients and other friends. The information contained in this publication should not be construed as legal, accounting, or investment advice. Should further analysis or explanation of the subject matter be required, please contact De Novo Strategy at