BayCom Corp., the holding company for Walnut Creek, California-based United Business Bank, has initiated a significant leadership overhaul and strategic pivot, aiming to accelerate growth through a more aggressive acquisition strategy. The company announced Thursday the appointment of three seasoned executives from Pacific Western Bank (PacWest) to key leadership positions: William Black Jr. as executive vice chair, Christopher Baron as chief executive officer, and Kevin Thompson as chief financial officer. This transition marks the departure of United Business Bank’s founding executive team, including CEO George Guarini, Chief Operating Officer Janet King, and CFO Keary Colwell, though Guarini will remain a member of the BayCom board.
Strategic Shift Towards Acquisitions
The appointment of the new leadership team signals a deliberate move by BayCom to revitalize its growth trajectory, particularly through mergers and acquisitions. Historically, United Business Bank has demonstrated a capacity for expansion via acquisitions, having completed ten such transactions in its approximately 22-year history. However, the company acknowledged a recent drought in deal-making, noting that the "acquisition pipeline has been quiet for the past four years." This period of inactivity was attributed by the company to a "turbulent period in the market and the Board’s disciplined unwillingness to pursue transactions that did not meet its standards on price, quality and strategic fit."
While BayCom emphasized that the bank has maintained a "clean balance sheet and strong credit quality" throughout this period, the lack of new deals has contributed to an "organic growth gap and a trading multiple that does not yet fully reflect the Company’s underlying value." The board’s assessment, as articulated by Chairman Lloyd Kendall Jr., is that the core vision of building a premier Western Regional Bank with significant scale and presence remains unchanged. What has evolved is the board’s perspective on the "tactics and the team needed to get us there." The expectation is that the newly appointed executives, with their demonstrable experience in large-scale transactions and strategic repositioning, are uniquely qualified to execute "larger, more transformational transactions."
Introducing the New Leadership Team: A PacWest Legacy
The selection of William Black Jr., Christopher Baron, and Kevin Thompson is a clear indicator of BayCom’s strategic intent. All three individuals bring extensive experience from Pacific Western Bank (PacWest), an institution that itself underwent significant restructuring and divestitures in the wake of regional banking instability in 2023.
William Black Jr. assumes the role of Executive Vice Chair at both BayCom Corp. and United Business Bank. His tenure at PacWest was marked by significant strategic initiatives. As Executive Vice President of Strategy and Corporate Development, Black was instrumental in directing the sale of billions of dollars in assets during 2023, a period of heightened market uncertainty following the failures of Silicon Valley Bank and other regional institutions. This included the divestiture of PacWest’s real estate lending unit, Civic Financial, and its subsidiaries. Furthermore, Black played a crucial role in securing $1.4 billion in emergency liquidity for PacWest and was a principal in the bank’s eventual sale to Banc of California. His stated objective at BayCom is to "pair [United Business Bank’s] foundation with a targeted growth model, a high-performance culture, and relentless execution."
Christopher Baron steps in as Chief Executive Officer. At the time of the Banc of California acquisition of PacWest, Baron served as PacWest’s President for the Los Angeles region. Following the merger, he transitioned to become President of Commercial and Community Banking at Banc of California, where he oversaw the combined entity’s branch network and commercial and middle-market banking operations. His prior experience includes leadership roles at MUFG Union Bank and U.S. Bank, providing him with a broad understanding of the banking landscape across different market cycles. Baron’s focus is expected to be on leveraging United Business Bank’s existing strengths while integrating new acquisitions and fostering a growth-oriented culture.
Kevin Thompson will serve as Chief Financial Officer. Thompson’s resume at PacWest highlights his expertise in financial restructuring and strategic asset management. He was credited with restructuring PacWest’s balance sheet, including the sale of approximately $7 billion in "non-core" loan portfolios. He also played a key role in designing PacWest’s merger into Banc of California. Following his departure from PacWest, Thompson moved to Heartland Financial as CFO, where he again navigated a significant corporate combination through Heartland’s acquisition by UMB Financial Corporation, which closed in 2023. His experience in optimizing balance sheets and managing complex financial integrations is expected to be invaluable as BayCom pursues its acquisition strategy.
The Departure of Founding Executives
The leadership transition signifies the end of an era for United Business Bank, which was founded in 2004. George Guarini, Janet King, and Keary Colwell, who have led the institution for nearly two decades, will transition out of their executive roles. However, the company has stated that they will remain employees for a 90-day period to ensure a smooth handover. George Guarini will also continue to serve on the BayCom board, providing a valuable link to the bank’s history and foundational principles.
In a statement, outgoing CEO George Guarini expressed his pride in the institution he helped build. "It has been my pleasure over the past 22 years to work with a tremendously talented group of people," Guarini said. "I know I speak for Janet and Keary as well when I say, we are looking forward to seeing where this new management team will take the Bank we started in 2004."
BayCom Chairman Lloyd Kendall Jr. acknowledged the contributions of the departing executives, stating that they were instrumental in "building the Company into the institution it is today." As of September, United Business Bank reported $2.6 billion in assets and operated 34 branches across five states, underscoring the substantial foundation left by the founding team.
Continuity and Key Retained Talent
Despite the significant executive changes, BayCom has indicated a commitment to retaining crucial operational talent. Chairman Kendall specifically highlighted the continued roles of three key executives who will remain with United Business Bank: Terry Curley, Chief Credit Officer; Felix Miranda, Chief Lending Officer; and Izabella Mitchell, Chief Risk Officer. The retention of these individuals suggests an intention to leverage existing expertise in credit, lending, and risk management, which are critical functions for any bank, especially one embarking on an aggressive growth strategy. Their continued presence will likely ensure operational stability and provide institutional knowledge as the new leadership team implements its plans.
Market Reaction and Analyst Perspectives
The announcement of the leadership transition and strategic shift was met with immediate market reaction. BayCom Corp. stock (NASDAQ: BCML) experienced a notable decline, dropping 11.1% on Friday, the day following the announcement. This dip suggests a divergence in investor expectations regarding the company’s future direction.
Timothy Coffey, a managing director at Brean Capital, offered an analysis of the market’s response, noting in a client note seen by American Banker, "The stock had traded on the premise the company was positioned to sell, while the new management team is focused on organic growth." This perspective implies that a segment of investors may have anticipated an outright sale of BayCom, a scenario often pursued by companies seeking to exit or consolidate during periods of market flux. The appointment of a leadership team focused on acquisitions, rather than immediate sale, may have altered these investor expectations, leading to a recalibration of stock valuation.
Broader Implications and Future Outlook
The strategic pivot by BayCom Corp. is indicative of broader trends within the regional banking sector. Following the turbulence of early 2023, many smaller and mid-sized banks are re-evaluating their growth strategies. While some have sought mergers for scale and stability, others, like BayCom, are looking to leverage their existing strengths and pursue opportunistic acquisitions to achieve market presence and profitability.
The success of this new strategy will hinge on the new leadership’s ability to identify and integrate suitable acquisition targets. The experience of Black, Baron, and Thompson at PacWest, a bank that navigated a complex period of asset sales and eventual merger, provides a strong indication of their capabilities in managing such processes. Their focus on "larger, more transformational transactions" suggests an ambition that goes beyond incremental growth, aiming to significantly reshape BayCom’s market position.
The challenge will be to execute these acquisitions effectively while maintaining the strong balance sheet and credit quality that United Business Bank has cultivated. The integration of different corporate cultures, systems, and client bases is often the most difficult aspect of M&A activity. Furthermore, the market’s initial negative reaction highlights the need for the new management team to clearly articulate their vision and demonstrate tangible progress to regain investor confidence.
The coming months will be critical for BayCom Corp. as it embarks on this new chapter. The coming together of experienced executives with a clear mandate for growth through acquisition sets the stage for a potentially dynamic period for United Business Bank and the broader regional banking landscape in the Western U.S. The company’s ability to execute its ambitious plans, coupled with the market’s eventual reception to its strategy, will determine whether this leadership transition proves to be a catalyst for significant expansion or a misstep in a challenging economic environment. The retention of key operational leaders and the legacy of the founding team provide a foundation, but the strategic acumen and execution capabilities of the new leadership will be the ultimate determinant of BayCom’s future success.
