Crossriver establishes fintech investment banking division

CRB Group, the parent company of Cross River Bank (Fort Lee, N.J.), announced Monday that it will begin offering investment banking services to fintech companies.

The company characterized the move as “strengthening our commitment to serving the fintech community.”

To lead this effort, CrossRiver has hired two industry veterans as co-heads of investment banking, Benjamin Samuelsle of Morgan Steney and Henry Pinel of SVB Securities. Mr. Samuels previously served as co-head of alternative capital solutions at Morgan Stanley. Mr. Pinel led the fintech investment banking business at SVB Securities, a subsidiary of the recently defunct SVB Financial Group.

“Together with two well-respected professionals who have decades of combined experience in both the fintech industry and capital markets, “We are proud to launch the broker-dealer’s investment banking division,” he said in a press statement. release. “Ben and Henry are tasked with further strengthening our product offering to fintech partners and other companies, enabling us to solve the individual needs of every client.”

Gade began his career as an investment banker at Bear Stearns. From 2000 until 2005, Gade was a Managing Director of Chella He Partners, a New York specialty investment banking firm focused on the emerging technology and telecommunications sectors.

Mr. Samuels and Mr. Pinel will work for CRB Securities, the second subsidiary of CRB Group. Their arrival signals significant expansion. Before Cross River announced its investment banking strategy, CRB Securities focused on private placement transactions, including asset-backed securities. Strategic advice on M&A, capital markets and other corporate finance has now been added to the menu.

Cross River Bank, with $8.7 billion in assets, is an active lender and supporter of fintech. In December, Cross River announced a $150 million credit facility to support a flexible rental product developed by Best Egg. This product allows renters to split payments into smaller payments to fit their cash flow.Cross River is also working on Debit program with Edge Boostwhich is being touted as the first-ever “bet now, pay later” platform.

Cross River has been serving fintech customers for nearly 15 years, providing a platform that provides both lending and payment services. Crossriver aims to be a one-stop shop for fintechs, but is a relative latecomer to investment banking. Many long-established companies have groups dedicated to serving fintech capital needs, but at least one company, San Francisco-based Financial Technology Partners, founded in 2002, specializes in the fintech space.

Steve McLaughlin, founder, CEO and managing partner of Financial Technology Partners, said in an email Monday that he is familiar with Gade and CrossRiver, and that the firm has in the past been “very satisfied” with FTP. He said that he was a “very loyal customer”. McLaughlin doesn’t know much about CrossRiver’s new foray into investment banking, but added that there is “room for a lot of bankers” in the fintech space.

Monday’s investment banking announcement comes about a year after the Federal Deposit Insurance Corporation’s announcement. issued a consent order Alleges that Cross River engages in unsafe or unsound banking practices related to fair lending regulations.Since citing Cross River, regulators issued many other orders For banks that are actively engaged in banking as a service.

Cross River was also included in the Small Business Administration’s prolific group of Paycheck Protection Program lenders. promised to investigate Following the December 2022 Congressional Inquiry into PPP Fraud. At the same time, the report noted that Cross River pursued program changes aimed at reducing fraud.

Despite increased regulatory scrutiny, Gade remains committed to Cross River’s business model. In fact, Gade predicted at an industry event in October that 2024 will be a breakout year for fintech.

Cross River did not respond to a request for comment by deadline.