Encino Bank Seeks Funds in Abu Dhabi
The head of Encino-based Independence Bank, allegedly owned by scandal-plagued Bank of Credit & Commerce International, went to Abu Dhabi last week at the urging of federal regulators to persuade officials there to pump $27 million into the troubled bank.
Chief Executive Fulvio V. Dobrich confirmed Wednesday that he met with representatives of Sheik Zayed bin Sultan al Nahyan, leader of the Persian Gulf sheikdom and majority owner of BCCI. Dobrich said, however, that he got no promises.
“They said they’ll think about it,” Dobrich said. He added that he spoke to Abu Dhabi officials about naming a trustee to help in selling the bank.
Independence Bank’s owner of record since 1985 is Saudi Arabian financier Ghaith R. Pharaon. The Federal Reserve, however, claims that Pharaon acted as a front man for BCCI when he acquired Independence for $23 million.
The Fed ordered Independence Bank bank sold, but questions over the ownership have complicated the process.
The bank, the largest commercial bank in the San Fernando Valley, recently has suffered big losses stemming largely from real estate investments and loans made under former Chief Executive Kemal Shoaib, who regulators allege was hand-picked for the job by BCCI officials.
The $27 million is the amount state banking regulators want the bank to come up with, up from $10 million originally requested by the Federal Deposit Insurance Corp., which insures its deposits.
Dobrich said that if the bank its not recapitalized by Oct. 17, Pharoan’s stake in the bank would be wiped out.
Then, Dobrich said, the bank can then begin negotiating seriously with prospective buyers, most of whom have been reluctant to proceed with talks because the bank’s ownership is clouded.